Preamble

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.

Aberdare Urban District Council Bill [Lords],

Read the Third time, and passed, with Amendments.

Maidstone Corporation (Trolley Vehicles) Provisional Order Bill,

Rotherham Corporation (Trolley Vehicles) Provisional Order Bill,

Read the Third time, and passed.

Mexborough and Swinton Tramways Company (Trolley Vehicles) Provisional Order Bill,

Pier and Harbour Provisional Orders (No. 2) Bill,

Southend-on-Sea Corporation (Trolley Vehicles) Provisional Order Bill,

As amended, considered; to be read the Third time To-morrow.

Oral Answers to Questions — NAVAL AND MILITARY PENSIONS AND GRANTS.

Mr. ROBINSON: 1.
asked the Minister of Pensions why the claim of a widow for pension on the death of her husband, who was a pensioner, was presumed to be barred under the seven years' limit in respect of claims for War disabilities, as set up under the War Pensions Act of 1921, seeing that the claim in respect of the disability had already been accepted; and if he will restore to widows, whose husbands die more than seven years after discharge, their rights under Articles 11 and 12 of the Royal Warrant of 1919?

The MINISTER of PENSIONS (Major Tryon): The hon. Member is under a misapprehension. No seven years' limit for widows' claims was set up by the War
Pensions Act, 1921, but was contained in the Royal Warrants of 1917 and 1919. I am not prepared to adopt the suggestion in the second part of the question that War widows should be reverted to the conditions of the Warrant of 1919 as this would deprive them of the advantages conferred on them by the Royal Warrant of 14th January, 1924, for which I was responsible and which gave extended benefits to widows of this class over the seven years' limit, going far beyond any rights previously enjoyed by them.

Oral Answers to Questions — BURGLARIES, LONDON.

Lord APSLEY: 2.
asked the Secretary of State for the Home Department the number of burglaries that have been committed in the London district this month and the value of property lost thereby?

The SECRETARY of STATE for the HOME DEPARTMENT (Sir William Joynson-Hicks): Seventeen burglaries were reported to the Metropolitan Police during the period lst-25th June, 18 arrests being made. No arrest was made in three of the cases. The value of property reported stolen was £653, of which £546 was recovered. In 10 cases there was no loss.

Mr. MONTAGUE: Does that number include the burglary in Moorgate Street?

Sir W. J OYNSON-HICKS: I have not heard of one there, but, if the hon. Member would like me to make inquiries, I will do so.

Colonel DAY: Can the right hon. Gentleman say in which districts burglaries are most prevalent?

Sir W. JOYNSON-HICKS: I cannot say.

Oral Answers to Questions — TRANSPORT.

MOTOR OMNIBUSES (SPEED, BARNES).

Mr. LOOKER: 3.
asked the Home Secretary whether the attention of the police has been drawn to the excessive speed at which motor omnibuses pass down Ranelagh Gardens, Barnes, and to the damage to the houses on that route caused thereby; and will he take steps to see that the legal speed limit is observed?

Sir W. JOYNSON-HICKS: I am informed by the Commissioner of Police that he has received complaints, though not recently, of damage done to houses in Ranelagh Gardens, and of excessive speed in that thoroughfare. The police are constantly on the alert to deal with excessive speed and convictions are from time to time obtained.

Sir HARRY BRITTAIN: Is it not true to say that if every driver drove as carefully as the drivers of the London omnibuses there would be a great diminution of accidents?

ROADS ADVISORY COMMITTEE.

Mr. R. MORRISON: 53.
asked the Minister of Transport whether any changes have taken place in the membership of the Roads Advisory Committee during the past 12 months?

The MINISTER of TRANSPORT (Colonel Ashley): The answer is in the negative.

Mr. R. MORRISON: 54.
asked the Minister of Transport how many meetings of the Roads Advisory Committee have been held during the past 12 months, and the number of members present at each meeting?

Colonel ASHLEY: Two meetings have been held during the past 12 months, i.e., on 29th November, 1926, and 31st March, 1927. At the first of these meetings six members were present, and at the second eight.

Mr. MORRISON: May I take it from that answer that as a rule this Committee meets twice a year?

Colonel ASHLEY: Oh, no, the hon. Member must not assume that; he must only assume that during the last 12 months they met twice.

LONDON UNDERGROUND RAILWAYS (VENTILATION).

Mr. TREVELYAN (for Mr. BUXTON): 55.
asked the Minister of Transport if he is aware of the complaints of the prevalence of vitiated air in the tube railways of London; and if he will state what steps he is taking for the purpose of insuring adequate ventilation?

Colonel ASHLEY: I have not received any recent complaint in regard to this
matter, but if the right hon. Gentleman will be good enough to let me know what particular section of the underground railways he has in mind I will communicate with the company.

Sir H. BRITTAIN: Is it not one of the proudest boasts of the tube railways that the traveller has the privilege of breathing rich ozone?

Colonel ASHLEY: Yes. I have seen it stated that the ozone in the tube railways is equal to a day at Southend.

ESSEX CONSTABULARY.

Mr. LOOKER: 4.
asked the Home Secretary if he is aware that the Essex Police Force is under the requisite strength in view of the great increase of population which has taken place; that an additional volume of work is thrown on the police stationed in the area through which the new Southend road passes owing to the necessity of constables being on point duty at level crossings during the weekend; that an increase in the force was recommended by the Standing Joint Committee but refused by his Department; and will he take steps to see that the force is brought up to the requisite strength?

Sir W. JOYNSON-HICKS: I am aware that in the Essex Constabulary, as in other forces, a number of vacancies are being maintained in the interests of economy, but it is not the case that I recently refused the Standing Joint Committee's request to increase the strength of the force. In fact I allowed them to add 10 men, and in so doing I took into consideration among other things the additional duties arising from the traffic on the new Southend road.

DEATH OF NURSE DANIELS (COMMISSION ROGATOIRE).

Colonel DAY: 5.
asked the Home Secretary why, in returning the last Commission Rogatoire to the examining magistrate at Boulogne, who is inquiring into the murder of Nurse May Daniels, an expressed wish accompanied it from the British authorities that it should not be published; and was there any special reason for this request?

Sir W. JOYNSON-HICKS: The only request for non-publication related to the present whereabouts of a witness, which had been disclosed in confidence to the authorities here by that witness's representatives in order that the Commission Rogatoire might be executed as requested by the French authorities.

Colonel DAY: Is the right hon. Gentleman aware that on account of this request certain rumours are getting about that the British Government have something to hide, and will he try to dispose of these rumours, especially so far as the French public are concerned?

Sir W. JOYNSON-HICKS: I am quits sure that if everybody knew the British Government as well as the hon. Member they would know that they have nothing to hide.

CONVICTS.

Lieut - Commander KENWORTHY: 6.
asked the Home Secretary how many persons are undergoing penal servitude at the present time, and the corresponding figure at an approximately similar date in 1917 and 1907, respectively?

Sir W. JOYNSON-HICKS: 1,473 persons are now undergoing penal servitude in this country. On 26th June, 1917, the number was 1,392 and on 26th March, 1907, it was 3,038.

ALIENS (HOTEL EMPLOYES).

Mr. HERBERT WILLIAMS: 7.
asked the Home Secretary how many aliens have been allowed to enter this country during each of the last three years for the purpose of working as hotel employés?

Sir W. JOYNSON-HICKS: Aliens are only allowed to enter this country for employment if in possession of permits granted by the Minister of Labour. The number admitted with such permits is shown in the published returns of which I am sending my hon. Friend a copy. Questions as to the issue of such permits are for the Minister, but I understand from him that in the three and a-half years ending the 30th June, 1927, 620 permits in respect of hotel employés were granted and 167 refused, and that
of the permits granted 286 were on condition that a British subject, normally employed in the hotel arid restaurant industry, secured a position abroad by way of exchange.

Mr. WILLIAMS: In the latter case, is the employment permanent in the case of the Briton who goes abroad in exchange for the foreigner who comes here, or is it a temporary job?

Sir W. JOYNSON-HICKS: A rough balance is struck between the employment there and the employment here.

Mr. WILLIAMS: Can the right hon. Gentleman tell us where all the foreign waiters which one sees in restaurants come from, having regard to the fact that only 600 appear to have been admitted?

Sir W. JOYNSON-HICKS: A great many of them are British subjects, born here of British parents. They are not under my care at all. I do not know where the others come from. I know that full returns of the number are kept, but I have not the same experience as my hon. Friend of restaurants.

Mr. R. MORRISON: Where permission is given to aliens to come here to act as waiters, is that permission valid only while they are acting as waiters, or does it become invalid if they leave the hotel and take other employment?

Sir W. JOYNSON-HICKS: A very strict record and watch is kept of all men who come here under the permission of the Ministry of Labour, and, if they cease to fill the occupations for which they came here they have to return. This is to help the labour market.

Oral Answers to Questions — EDUCATION.

HIGHER AND TECHNICAL EDUCATION (EXPENDITURE).

Mr. HARRIS: 8.
asked the President of the Board of Education whether, of the total estimated expenditure by the Board of Education and the local education authorities upon higher education, it is possible to separate the amounts spent on secondary education and technical education, respectively; and what was the total expenditure on secondary and technical education, respectively, during each of the five years ending 31st March, 1927?

The PRESIDENT of the BOARD of EDUCATION (Lord Eustace Percy): I will circulate the reply in the OFFICIAL REPORT.

Mr. HARRIS: Am I to understand that the figures asked for will be furnished separately?

Lord E. PERCY: No. Sir. There are some figures I can furnish separately, and some that I cannot.

Following is the reply:

The expenditure of local authorities under the various headings of higher education is given on page 13 of the Memorandum on the Board's Estimates, 1927 [Cmd. 2885], a copy of which I am sending the hon. Member. The Board's grants are not divided under headings but form one consolidated grant for higher education. In so far as the Board's expenditure consists of grants to local authorities it is included in the expenditure of local authorities. The Board also make grants to non-local education authority bodies in respect of institutions for secondary and technical education. The figures for the last five years have been:


Year ending, 31st March.
Non-L.E.A. Secondary Schools.
Non-L.E.A. Technical, &c., schools.





£
£


1923
…
…
1,278,380
103,366


1924
…
…
1,154,812
113,473


1925
…
…
1,141,132
110,098


1926
…
…
1,140,352
107,570


1927
…
…
1,193,024
116,423

LOCAL AUTHORITIES' SCHEMES.

Mr. HARRIS: 9.
asked the President of the Board of Education how many local education authorities have submitted schemes of educational work as contemplated by the Education Act, 1918; have the Board adopted any general policy of approving or disapproving of such schemes; what was the date when the Board received the scheme drawn up by the London County Council; have the Board addressed any communication to the London County Council on that scheme; and what has been the nature of such communication or communications?

Lord E. PERCY: Ninety-nine local authorities submitted schemes. The details of these schemes were discussed with the authorities, but in view of the financial position existing at the time my predecessors in office did not feel justified in giving their statutory approval to the schemes which would make it obligatory upon the authorities to give effect to them. The scheme prepared by the London County Council was received by the Board on the 27th July, 1920, and it was subsequently intimated to the council that in the then existing circumstances the Board would have to defer the question of giving statutory approval to the scheme. The hon. Member is, I think, aware of the position in regard to the programmes submitted by local authorities under Circular 1358.

MENTALLY DEFECTIVE CHILDREN.

Mr. HARRIS: 10.
asked the President of the Board of Education if there is any standard of certification for mental deficiency governing the admission of children to schools for mental defectives; if so, what is the standard; have any instructions been issued to local education authorities by the Board on this subject; if so, what is the nature of such instructions; has there been during recent years any variation in the standards used by the school medical officers of the local education authorities or advice by the Board's medical officer; and have the Board issued any memoranda, or are there any reports available, which would inform local education authorities as to the Board's views and policy with regard to mentally defective children?

Lord E. PERCY: As regards the first two parts of the question, I would refer the hon. Member to Section 55 (1) of the Education Act, 1921, and, as regards the last part, to the Annual Reports of the Board's chief medical officer, particularly to Section VII of the Report for 1925. I am sending the hon. Member a copy of Circular 1359 of the 23rd April, 1925, together with the form of report referred to therein, which relates to the question of uniformity of examination. The Board have not made any alterations in the advice given by them to local authorities, nor are they aware
that there has been any variation in the standards adopted by the authorities' medical officers.

PLAYGROUNDS (NORTH RIDING).

Mr. SHEPHERD: 13.
asked the President of the Board of Education whether his attention has been called to the Report of the county medical officer for the Yorks (North Riding) education authority, which states that at a large number of schools the playgrounds are in a bad state of repair, and in some cases are so small that the work is restricted and the children deprived of proper games and activity; and whether, in view of these facts, he will take such steps as are within his power as shall ensure that every elementary school shall have a playground fit for children to play in?

Lord E. PERCY: I have seen the report in question. I believe that the North Riding authority is fully alive to the importance of doing all they can to provide adequate playground accommodation.

Mr. SHEPHERD: Is the right hon. Gentleman aware that there are many schools where the Board of Education syllabus on physical training cannot be carried out because of the inadequacy of the playgrounds?

Lord E. PERCY: That also is in the report to which the hon. Member has referred. I was in the North Riding the other day, and I visited a good many of these small schools. If the hon. Member is acquainted with the condition of the small rural schools in the North Riding, he will appreciate the difficulty which the local authorities must be under. I am quite sure that they are doing all they can.

PUBLIC LIBRARIES.

Captain CROOKSHANK: 12.
asked the President of the Board of Education whether he proposes to arrange for the free distribution to all public libraries of a copy of the recent Report of the Committee dealing with that subject?

Lord E. PERCY: Public free libraries are authorised to obtain copies of Government publications from His Majesty's Stationery Office at one-half the published price, and I am afraid that I cannot undertake to make the further concession suggested by my hon. and gallant Friend.

Mr. RILEY: Are the public libraries aware that they can obtain the report at half the published price?

Lord E. PERCY: If they did not know it before, I think they will know it now.

Oral Answers to Questions — PUBLIC HEALTH.

DITCHES AND STAGNANT POOLS.

Colonel DAY: 14.
asked the Minister of Health whether, in view of the inconvenience and annoyance suffered by the public through certain ditches in the country becoming silted up and overgrown, causing a breeding place for mosquitos and other insects, he will give instructions to all local authorities that owners of land containing such stagnant pools be compelled under the Public Health Act to have these places cleaned out and sprayed with an adequate insecticide?

The MINISTER of HEALTH (Mr. Chamberlain): I have no authority to give such instructions. Under Section 91 of the Public Health Act, 1875, any pool, ditch, etc., in such a state as to be a nuisance or injurious to health is to be deemed a nuisance liable to be, dealt with under the Act. The question whether any particular pool is a nuisance is one of fact to be determined by the Court in any proceedings instituted under the Section.

Colonel DAY: Can the right hon. Gentleman see his way to draw the attention of local authorities to this particular section, as a good many of them are not aware of it?

Mr. CHAMBERLAIN: I do not think that there is any necessity for that.

SKIMMED CONDENSED MILK.

Mr. HURD: 19.
asked the Minister of Health whether he is aware that the imports of skimmed condensed milk in the first five months of the year were the approximate equivalent of 25¾ million gallons of liquid milk; and what measures he proposes to take for the more effective protection of the child population from this unsuitable form of food?

Mr. CHAMBERLAIN: I would refer my hon. Friend to the answer which I gave to the hon. and gallant Member for Chelmsford (Lieut.-Colonl Howard-Bury) on the 23rd instant.

Mr. HURD: When does the right hon. Gentleman think he will be in a position to inform the House as to the measures he proposes to take to meet this need?

Mr. CHAMBERLAIN: I think it will not be very long.

MILK AND DAIRIES ORDER (EASTBOURNE).

Mr. KELLY: 21.
asked the Minister of Health whether he is aware that the Eastbourne Local Authority initiated legal proceedings against a local firm of dairymen with respect to insanitary conditions in their dairies contrary to the provisions of the Milk and Dairies Order, and that subsequently the proceedings were withdrawn although the infringement of the Order was not denied; and whether he will take steps to see that the Order is strictly enforced?

Mr. CHAMBERLAIN: I am aware of the facts stated in the question, but I understand that the summonses were withdrawn in consideration of the defendant paying the costs incurred and taking satisfactory steps (including a change of staff) to ensure that the Order would be complied with in future. While I have no jurisdiction to interfere with the action of the authority taken in a particular case, I may say that the course which was followed in this instance is one which is frequently adopted with advantage by local authorities, especially in the administration of new legal provisions.

MOSQUITOES.

Mr. ROBINSON: 27.
asked the Minister of Health if his attention has been called to the recent death of a man from a mosquito bite; and what action has been taken by his Department to diminish the number of mosquitoes in this country?

Mr. CHAMBERLAIN: The answer to the first part of the question is in the negative. As regards the second part, I would refer the hon. Member to the answer which I gave on this subject on the 1st March to the hon. Member for Central Southwark (Colonel Day).

Oral Answers to Questions — HOUSING.

REQUIREMENTS.

Sir JOHN POWER: 15.
asked the Minister of Health what is the present estimated annual requirement of new
houses to meet the growth of population and the number required to replace closed and demolished houses; and if he has any figures as to the addition to the housing accommodation during the year ended 31st March last due to the conversion of existing houses into flats?

Mr. CHAMBERLAIN: It is difficult to frame a reliable estimate of the annual need for new houses, but the present annual requirement in order to meet the growth of population has commonly been estimated at about 70,000 houses. Statistics are not available of the number of houses at present being closed or demolished, or with regard to the information desired by the hon. Member in the last part of his question.

Mr. ERNEST BROWN: May I ask upon what standard these estimates are based?

Mr. CHAMBERLAIN: What standard?

Mr. BROWN: Yes, the number of persons per house, space, and so on.

Mr. CHAMBERLAIN: I think they are based on the figures in the census, and upon an assumed average of the number of persons per family.

Mr. MONTAGUE: May I ask whether the National Housing Town Planning Committee does not place the requirements at a much higher figure?

Mr. CHAMBERLAIN: The hon. Member is probably confusing two estimates. The estimate to which he refers includes the number of houses required to replace those which are demolished.

Colonel DAY: Is the right hon. Gentleman satisfied that houses are being demolished in sufficient numbers for the purposes of the various slum clearance schemes.

SLUM CLEARANCE, GLASGOW.

Mr. E. BROWN: 59.
asked the Secretary of State for Scotland if his attention has been drawn to the Eighth Annual Report of the Scottish Board of Health, and, in particular, to Chapter 2, paragraph 16, as to the insanitary conditions in Glasgow slums; and if any action has been taken on this Report or, if not, if the Board of Health contemplate immediate action to deal with these conditions?

The SECRETARY of STATE for SCOTLAND (Sir John Gilmour): I am aware of the terms of the paragraph in question. As indicated therein, it is a quotation from the Report of the Commissioner appointed by the Scottish Board of Health to inquire into an improvement scheme submitted by the Corporation of Glasgow under Part II of the Housing (Scotland) Act, 1925. Details of the corporation's proposals for dealing with the areas to which the Commissioner's Report refers will be found in paragraph 15 of the Report. The improvement scheme has now been confirmed by the Board, and the local authority are in course of carrying out its provisions, which include the demolition and clearing away of the insanitary properties and the provision of new dwellings to re-house the dispossessed tenants.

Mr. MACPHERSON: Is there any reason to doubt the truth of the terrible statement made by the Commissioner?

Sir J. GILMOUR: No, Sir, there is no reason to doubt that the conditions are accurately described.

Mr. MACPHERSON: Does the right hon. Gentleman intend to approach the Corporation of the City of Glasgow, so that something shall be done?

Sir J. GILMOUR: I have explained that the Corporation of Glasgow are already dealing with this particular area, and I am taking every step to try to expedite housing in Scotland.

RURAL AREAS (SANITATION).

Sir J. POWER: 16.
asked the Minister of Health what steps are being taken to ensure suitable town-planning, including the provision of adequate sanitation, in rural areas adjoining large towns in which extensive building is taking place?

Mr. CHAMBERLAIN: Town planning schemes are in course of preparation for the whole or parts of 127 rural districts, either by the rural district councils themselves or by neighbouring urban authorities, and I am encouraging other local authorities to take similar action, where needed, by promoting joint town planning committees of neighbouring authorities to consider the town planning needs of their areas. Provision for sanitation is usually made under the general law, apart from town planning schemes.

Mr. E. BROWN: Does the Minister propose to extend the Housing and Town Planning Acts? Am I right in believing that the Housing and Town Planning Acts only apply to towns with populations of over 20,000?

Mr. CHAMBERLAIN: Yes. I am not proposing to take any further steps.

Mr. MONTAGUE: Does the right hon. Gentleman not consider that the principles of town planning contradict the idea of reducing the size of houses advocated in his speech of yesterday?

Mr. CHAMBERLAIN: No, Sir. I do not agree.

Sir JOSEPH NALL: Is the right hon. Gentleman aware that the necessities of town planning may require an adequate number of dwellings of the size necessary for the people concerned?

WIDOWS' PENSIONS (EDINBURGH AND LEITH).

Mr. E. BROWN: 17.
asked the Minister of Health the number of widows in receipt of pensions under the Act of 1925 in the port of Leith and the city of Edinburgh, respectively, and the average weekly amount paid to them?

Sir J. GILMOUR: I have been asked to reply. I regret that the information is not available as the claims are not arranged on a territorial basis.

Oral Answers to Questions — AGRICULTURE.

RATING AND VALUATION ACT, 1925 (FARM BUILDINGS).

Mr. H. WILLIAMS: 18.
asked the Minister of Health if he can furnish an estimate of the probable reduction in total assessment for farmers which will result from the extension of the Agriculture Rates Act to farm buildings under the Bating and Valuation Act, 1925?

Mr. CHAMBERLAIN: I am not in a position to add to the reply which was given to the hon. Member for Edmonton (Mr. Broad) on the 26th April, 1926. I am sending my hon. Friend a copy of that reply.

EMPIRE MARKETING (BRITISH BARLEY).

Lieut.-Colonel HENEAGE: 43.
asked the Minister of Agriculture how far he has been able to make use of the grant allotted from the Empire Marketing Board for the marketing of British cereals to consider the special features of barley marketing in the interests of British producers?

The MINISTER of AGRICULTURE (Mr. Guinness): No grant has been expressly made to my Department in regard to the marketing of British cereals, but the work now being undertaken by the Ministry, with the aid of the general grant of £40,000 a year, includes an investigation into the marketing of cereal crops. A report, embodying the general results of this investigation, will, I hope, be issued in the autumn. Due attention will be given in the report to the marketing of home-grown barley.

Lieut.-Colonel HENEAGE: May I ask whether attention has been called to the difficulties of barley growers?

Mr. GUINNESS: I have drawn the attention of those who are compiling this information to my hon. and gallant Friend's question, and I am sure that this aspect of the matter is not being neglected.

Lieut.-Colonel HENEAGE: Can the right hon. Gentleman say when he expects to get a report?

Mr. GUINNESS: I am afraid I cannot give any approximate date without notice.

Mr. WALLHEAD: Without decrying in any way the attempt to establish Empire marketing on a sound basis, will the right hon. Gentleman say whether it would not be as well to pay as much attention to British agriculture as to agriculture in the Dominions?

Mr. GUINNESS: British agriculture is now getting a grant from the Empire Marketing Board, which is being devoted to an examination of, and a report upon, the conditions of marketing. We believe it is very necessary, if the farmer is to get the profits which now escape, that he should have the opportunity of organising marketing on an economic basis.

Mr. MONTAGUE: Does the right hon. Gentleman not think that British fruit can be sold as cheap as Empire fruit is at railway stations?

ENGLISH SUGAR-BEET CORPORATION (JUTE BAGS).

Mr. JOHNSTON: 44.
asked the Minister of Agriculture whether, seeing that the terms on which financial assistance is given to the English Sugar-beet Corporation, Limited, require that a percentage of the corporation's contracts shall he placed in this country, he can say in which country the corporation has placed its contract for one million jute sugar bags for the year 1927?

Mr. GUINNESS: There is no statutory provision which compels beet-sugar factory companies to obtain their requirements in this country, other than that laid down in the British (Subsidy) Act, 1925, which requires that not less than 75 per cent. of the plant and machinery installed in the factories shall be manufactured in Great Britain. I have, therefore, no power to intervene in the placing of contracts for jute bags. I am, however, informed that the English Beet-sugar Corporation has purchased 1,918,000 sugar and pulp bags for the coming manufacturing campaign on behalf of itself and the other factories in the Anglo-Dutch group. Of this number, I understand, that 1,218,000 bags were purchased from British firms and the balance from Dutch firms.

Mr. JOHNSTON: Arising out of the last sentence of the answer, may I ask the right hon. Gentleman whether those purchases from British firms relate to bags produced in this country or whether British firms are purchasing, or may purchase, these bags abroad?

Mr. GUINNESS: I understand they are bags of British production. As a matter of fact, they are from ½d. to ld. dearer than the foreign bags, but, naturally, I am doing everything in my power to encourage these companies, where possible, to obtain all their requirements in this country.

SMALL HOLDINGS.

Mr. RILEY: 47.
asked the Minister of Agriculture how many applications have been made to the Ministry from county councils for sanction to carry out schemes
for small holdings under the Small Holdings Act of 1926, the total acreage of the schemes, and the estimated cost?

Mr. GUINNESS: Eight proposals for the acquisition of land and its equipment and adaptation for small holdings have been submitted to the Ministry under Section 2 of the Small Holdings and Allotments Act, 1926. The area involved is 774 acres and the estimated capital expenditure for purchase and equipment is £36,967.
In addition, 12 cases have been submitted under Sub-section (5) of Section 2, relating to the further equipment of land already acquired, the estimated cost of such further equipment being £7,563.

Mr. RILEY: Have these applications all been passed?

Mr. GUINNESS: I am not certain how many of the applications have actually been passed, but I take it they are undergoing the ordinary process of examination and that they will all be passed.

Oral Answers to Questions — UNEMPLOYMENT.

BENEFIT.

Mr. SHEPHERD: 25.
asked the Minister of Health whether he is aware that on 23rd June an unemployed man, in possession of a travelling card and a current national health card with 22 stamps, left Middlesbrough to travel by road to Catterick, where he had an assurance of work, but on arrival at Darlington he had to seek shelter for the night in the casual ward; that in the morning he was told he would be detained until the next day in accordance with the Regulations; that ultimately the man was allowed out from 1 p.m. to 2 p.m. to get his unemployment card stamped at the Exchange but was not allowed to sign for unemployment benefit on the ground that he was an inmate of the workhouse; and whether he will amend the Regulations so that the detention of a man in these circumstances shall not be required?

Mr. CHAMBERLAIN: My attention has not previously been called to this case, but I will make inquiries.

Mr. SHEPHERD: Is it within the discretion of the board of guardians to allow a man who is genuinely seeking employment to go, without performing any task?

Mr. CHAMBERLAIN: I cannot answer that question without notice.

Oral Answers to Questions — FINANCE BILL.

BETTING DUTY.

Colonel DAY: 28.
asked the Chancellor of the Exchequer whether his Department has any record of the amount of money paid to the Inland Revenue authorities for betting taxation on illegal betting; and, if so, the amount so received?

The PARLIAMENTARY SECRETARY to the TREASURY (Commander Eyres Monsell): The information is not available.

Colonel DAY: Will the right hon. and gallant Gentleman call the attention of the Chancellor of the Exchequer to the fact that last week a man who was fined £100 for illegal betting, said he had disclosed his books to the Treasury and that the Treasury had written asking for a further 4½d. due on illegal betting.

Commander EYRES MONSELL: Yes, Sir.

INCOME TAX AND SUPER-TAX.

Sir HUGH LUCAS-TOOTH: 30.
asked the Chancellor of the Exchequer whether he is aware that the Board of Inland Revenue have declined to consider the payment of certain reclaims in respect of Income Tax, Schedule D, after their duly appointed officer, the inspector of taxes, had undertaken that the re-claimants should not be debarred from relief in respect of their original payments; and whether he will inquire into any cases of which particulars are furnished?

Commander EYRES MONSELL: I will certainly make inquiry into any case of the kind which my hon. Friend brings to my notice.

Mr. RILEY: 35.
asked the Chancellor of the Exchequer the amounts paid in Super-tax for the years 1923–24, 1924–25,
and 1925–26, and the number of persons paying Super-tax in each of the three years, respectively?

The CHANCELLOR of the EXCHEQUER (Mr. Churchill): The hon. Member will find the latest information on this subject in paragraphs 57, 61 and 62, Tables 64, 67 and 68, of the 69th Annual Report of the Commissioners of Inland Revenue (Command Paper 2783).

MOTOR TAXATION.

Captain CROOKSHANK: 31.
asked the Chancellor of the Exchequer whether he has instituted an inquiry regarding the possibility of substituting a tax on petrol for the present motor taxes; and, if so, what is the result of the inquiry?

Mr. CHURCHILL: The position remains generally as I indicated in the Budget Statement last year.

Lieut.-Colonel HOWARD-BURY: Did not the right hon. Gentleman promise in last year's Budget that he would favourably consider holding an inquiry and is he aware that each year sees more countries adopting the petrol tax, and that they have overcome in those countries the difficulties that permanent officials raise in order to prevent a change over from horse-power to petrol?

Mr. CHURCHILL: The difficulties that have prevented us from adopting it have not been difficulties raised by the permanent officials, who have shown extraordinary skill in avoiding those difficulties. The reasons we were governed by were those of general policy. The matter is still under consideration.

Captain CROOKSHANK: Will the right hon. Gentleman consider sending out a Select or other Committee to go into the matter?

Mr. CHURCHILL: I really do not think a Committee could give any more information than we have at our disposal.

Sir J. NALL: Has not the incidence of the horse-power tax materially contributed to the great improvement of the engine power of British cars?

Captain ARTHUR EVANS: Has the right hon. Gentleman consulted petrol
companies with regard to the possible collection of a petrol tax, and, if so, what are their views?

Mr. CHURCHILL: I do not think the difficulties are insuperable, but the matter must be most carefully considered.

Lieut.-Colonel HOWARD-BURY: Has not the horse-power tax cramped the design of cars and allowed the Americans to gain the Australian and Canadian markets?

DOUBLE TAXATION (UNITED STATES).

Captain A. EVANS: 34.
asked the Chancellor of the Exchequer if His Majesty's Government have entered into negotiations with the United States Treasury Department with a view to the abolition of double Income Tax; what form the negotiations took; and what is the present position?

Mr. CHURCHILL: An agreement has been reached, and is in force, with the United States for relief from double Income Tax on the profits from the business of shipping; but there have been no negotiations with that Government with a view to a general agreement for the avoidance of double taxation. In this connection I would invite my hon. and gallant Friend's attention to the reply which I gave on this subject to the hon. Member for Maryhill on 23rd June: I am sending him a copy of that reply.

PERSIA (BRITISH DEBT).

Mr. RILEY: 36.
asked the Chancellor of the Exchequer if there is any outstanding loan or debt owing to this country by the Government of Persia, either for money advanced or work done for or material supplied to the Government of Persia; and, if so, what is the amount of such loan or debt?

Mr. CHURCHILL: In April, 1925, His Majesty's Government agreed to reduce their claim in respect of various loans made to the Persian Government from over £4,500,000 to £2,000,000 and to accept repayment by means of 25 annuities of £180,000 each to begin in 1926–27. The Persian Government accepted this offer in March, 1926, and promised to submit it for ratification by the Persian Legislature. This has
not yet been done, and accordingly representations were made to the Persian Government on 10th May last, urging that the agreement should be submitted for ratification without further delay.

Mr. RILEY: Does that arrangement provide for interest as well as the reduction of the capital sum?

Mr. CHURCHILL: Yes, Sir. The annuities of £180,000 represent seven per cent. interest and two per cent. sinking fund.

Lieut.-Commander KENWORTHY: How many years are the payments to run?

Mr. CHURCHILL: Twenty-five.

Lieut.-Commander KENWORTHY: Is the right hon. Gentleman aware that the Persian Budget balances better than his, and that the state of the country is, proportionately, more prosperous than the state of this country under his Government?

Mr. CHURCHILL: If any opportunity occurs of discussing the matter with the representatives of the Persian Government, I shall not fail to bring to their notice the points mentioned by the hon. and gallant Member.

Oral Answers to Questions — GOVERNMENT DEPARTMENTS.

INLAND REVENUE AND CUSTOMS AND EXCISE DEPARTMENTS.

Lord APSLEY: 37.
asked the Chancellor of the Exchequer the number of civil servants engaged in the Inland Revenue and Customs and Excise Departments, respectively, on 1st April in each of the last three years.

The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): With my Noble Friend's permission, I will circulate the answer in the OFFICIAL REPORT.

Following is the answer:

Excluding collectors of taxes and clerks to Commissioners, whose employment on Inland Revenue duties is, in the majority of cases, part-time only, the staff employed by the Inland Revenue numbered at the


1st April, 1925
…
…
15,904


1st April, 1926
…
…
16,288


1st April, 1927
…
…
16,477

The total staff employed in the Customs and Excise Department was as follows:


1st April, 1925
…
…
11,228


1st April, 1926
…
…
11,564


1st April, 1927
…
…
11,795

Lieut.-Commander KENWORTHY: 40.
asked the Financial Secretary to the Treasury what are the reasons which have necessitated an increase in the number of officials and other persons employed in His Majesty's Customs of over 500 since 1924; and whether he anticipates any further increase in the near future?

Mr. McNEILL: The increase in the number of persons employed in the Customs and Excise Department since 1924 is attributable to the additional revenue and non-revenue work since imposed upon the Department by legislation. As regards the last part of the question, some further increase will be necessary, but it is anticipated that on the basis of existing volume of work the position will soon be stabilised.

Lieut.-Commander KENWORTHY: Is the right hon. Gentleman aware that the Government have repeatedly stated that no increases will be required in connection with the new duties and, in that case, how does he account for this state of affairs?

Mr. McNEILL: I have no doubt, where that statement applies, it will prove to be correct.

Mr. E. BROWN: Is the right hon. Gentleman aware that one hundred of these officials are housed in His Majesty's Mint, there is such an increase owing to the Safeguarding Duties?

SALARIES.

Mr. E. BROWN: 38.
asked the Financial Secretary to the Treasury whether he will inaugurate a uniform method throughout the service of the payment of the salaries of all officers established as the result of the Lytton and Southborough examinations; whether he can see his way to abolishing the present practice of paying such salaries at the monthly rate of eight per cent. to the nearest £1below; and whether he will consider the desirability of substituting payment at the rate of one-twelfth of the annual salary each month?

Mr. McNEILL: I would refer the hon. Member to the answer I gave to an identical question put by him on the 26th May last.

TEMPORARY STAFF (TYPISTS).

Mr. KELLY: 73.
asked the First Lord of the Admiralty what is the number of temporary staff employed in the headquarters offices and outports of his Department, respectively, in each of the following grades: Grade 1 shorthand-typists, Grade 2 shorthand-typists, Grade 1 copying-typists, and Grade 2 copying-typists; and the average length of service of the shorthand-typists and copying-typists concerned?

Lieut.-Colonel HEADLAM: The figures so far as concerned the Admiralty are as follow:





Average Service:




No.
Years.
Months.


Shorthand-typists:


Grade I.
…
23
6
5


Grade II.
…
2
4
4


Typists:


Grade I.
…
55
7
0


Grade II.
…
1
2
0


There are also two Grade III. typists, average service two years. The supply of similar information in regard to the out-port staff would necessitate considerable enquiry, and therefore, unless the hon. Member thinks this information of such

TEMPORARY Shorthand-typists and Copying-typists serving in certain Departments of the Board of Trade.


—
Temporary Shorthand-typists.
Temporary Copying-typists.
Remarks.


Grade I.
Grade II.
Grade I.
Grade II.


Establishment Department
13
3
26
1
This staff is part of a "pool" serving all Departments of the Board.


Census of Production Office
1
—
5
—



Solicitor's Department
(Included under Establishment Department.)



Industrial Property Department (Including Patent Office).
—
—
6
—



Manchester Trade Marks Office
—
—
—
—



Companies Department
(Included under Establishment Department.)



Department of Overseas Trade
27
1
24
—



Mines Department
4
—
3
2




45
4
64
3

urgent public importance as to justify the expenditure of considerable time and labour, I trust that he will not press for it.

Mr. MACQUISTEN: Were the machines they use made in Britain or America?

Mr. KELLY: May I consult with the hon. and gallant Gentleman?

Mr. KELLY: 60.
asked the President of the Board of Trade what is the number of temporary staff employed as Grade 1 shorthand-typists, Grade 2 shorthand-typists, Grade 1 copying-typists, and Grade 2 copying-typists, respectively, in each of the following departments of the Board of Trade: Establishment Department; Census of Production Office; Solicitor's Department; Industrial Property Department, including Patent Office; Manchester Trade Marks Office; Companies Department; Department of Overseas Trade; and Mines Department?

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Sir Burton Chadwick): The answer has been prepared in tabular form. Perhaps the hon. Member will, accordingly, allow me to circulate it in the OFFICIAL REPORT.

Following is the answer:

The following statement gives the information desired by the hon. Member:

ECONOMIES.

Captain CROOKSHANK: 32.
asked the Chancellor of the Exchequer what, if any, economies have been made in the administration of the Civil Service since the Budget statement, whether by reduction of recruiting or otherwise?

Mr. CHURCHILL: I would refer my hon. Friend to the answer given to the hon. Member for Nottingham Central (Mr. Bennett) on 22nd June.

CLERICAL CLASS (MESSRS. F. L. MYNETT AND A. E. ELLIS).

Mr. BRIANT: 41.
asked the Secretary to the Treasury whether the attention of the Civil Service Commission has been drawn to the fact that two officers employed in the Post Office Savings Bank, Messrs. F. L. Mynett and A. E. Ellis, who were refused establishment in the clerical class on medical grounds in 1919, have continued to render effective service ever since, and that they have now been selected for permanent posts in the P-class; and whether, in view of these facts, he will direct that the original refusal of establishment, on medical grounds shall be re-opened?

Mr. McNEILL: Mr. F. L. Mynett and Mr. A. C. Ellis were rejected on medical grounds in November, 1921, and April, 1923, respectively, and their cases were again considered in February, 1927, by the Civil Service Commissioners, who saw no grounds for re-opening them for further medical examination. The Commissioners cannot regard these officers as eligible for appointment to pensionable posts, and I am not prepared to interfere with their independent discretion in the matter.

Oral Answers to Questions — FIGHTING SERVICES.

FOOD CONTRACTS.

Mr. HURD: 39.
asked the Financial Secretary to the Treasury what is the proportion and value of British contracts for meat for the Army, Navy and Air Force which are given to foreigners in spite of the Government's general policy of preference for British goods?

Mr. McNEILL: The total meat purchases for the Army, Navy and Air Force for the last three years, including tinned meat, amounted to approximately
£3,000,000. Purchases of foreign meat (mainly tinned) amounted to £106,000, or less than 4 per cent. These figures do not include home stations at which requirements are less than 100 lbs. a day, or certain foreign stations where contracts are made locally.

Sir H. BRITTAIN: From which foreign country does the bulk of this foreign meat come?

Mr. McNEILL: I could not say without notice, but I think the Argentine.

Mr. HURD: 51.
asked the Secretary of State for the Colonies what steps are being taken by the Empire Marketing Board to induce the authorities concerned to carry out the Board's precept of Buy British Goods in respect of meat purchases for the Army, Navy and Air Force; and whether the Board will consider making a grant or taking other means to ensure a ration of at least two days of British home-grown meat in each week?

The UNDER-SECRETARY of STATE for the COLONIES (Mr. Ormsby-Gore): The Empire Marketing Board has been in frequent consultation with the Departments concerned, and as my hon. Friend is aware from the answer given to him on 20th June by the Financial Secretary to the Treasury, the general contract policy of His Majesty's Government in Great Britain to give substantial preference to Empire over foreign goods is applied to meat purchases for the fighting forces. I do not think the proposal suggested in the last part of the question is likely to commend itself to the Empire Marketing Board.

Mr. HURD: How many meat contracts are now given to British home producers as a result of the hon. Gentleman's representations?

Mr. ORMSBY-GORE: I should like to have notice of that question.

Sir H. LUCAS-TOOTH: 63.
asked the Secretary of State for War whether all the potatoes, other vegetables, and fruit served to the troops are grown in this country; and, if not, whether he can estimate what proportion of them is home-grown?

The SECRETARY of STATE for WAR (Sir Laming Worthington-Evans): Of potatoes and other vegetables served to
the troops, by far the greater quantity, with the exception of onions, which are mainly imported from Spain and Egypt, is grown in this country. In addition, every endeavour is made to encourage local production by the obtaining of supplies direct from farmers or local markets in the vicinity of military stations. As regards vegetables generally, small quantities of new potatoes are obtained from Spain, St. Malo and Jersey, and of tomatoes, for cooking purposes, from Spain and Teneriffe at periods of the year when home-grown supplies are not available. With regard to fruits, the supply, in the main, is limited to apples, oranges and bananas. Of apples, a large proportion of those supplies is grown in Canada, Australia and New Zealand, while a certain quantity is imported from America, English apples being supplied when available. As regards bananas and oranges, the farmer are mainly supplied from Jamaica, a small proportion being obtained from the Canary Islands, while the bulk of the supply of oranges is obtained from Spain, with a small proportion from South Africa.

Sir H. LUCAS-TOOTH: 69.
asked the First Lord of the Admiralty whether all the potatoes, other vegetables, and fruit served to the men in His Majesty's ships and dockyards are grown in this country; and, if not, whether he can estimate what proportion of them is homegrown?

The PARLIAMENTARY SECRETARY to the ADMIRALTY (Lieut.-Colonel Headlam): Although the great majority of such supplies are British grown, it is not possible to estimate what proportion of the vegetables and fruit consumed in His Majesty's ships and naval establishments is home-grown.

Mr. HURD: Are steps taken to encourage those in authority in these several centres to buy British home goods where even they can?

Lieut.-Colonel HEADLAM: Yes, whenever it is possible British home-grown goods are obtained.

Sir H. BRITTAIN: Why should what is possible for the War Office, which has given a most picturesque answer, be impossible for the Admiralty?

Lieut.-Colonel HEADLAM: I have no doubt I could give as picturesque an answer as that given by my right hon. Friend, but one picturesque answer is good enough for one day.

COST-OF-LIVING (INDEX FIGURE).

Captain A. EVANS: 64.
asked the Secretary of State for War whether he is aware how the present index cost-of-living figure affects the Services; and if he will consider the alteration of this figure as far as it affects the Army?

Sir L. WORTHINGTON-EVANS: The rates of pay, half-pay and retired pay for officers sanctioned in 1919 were settled in relation to the cost-of-living index figures published by the Ministry of Labour. The periodical review to which these rates are subject is, therefore, necessarily based on those figures, as explained on pages 228 and 282 of the current Army Estimates.

Captain EVANS: Can the right hon. Gentleman say when the last review of the cost-of-living index figure took place, and whether the Minister of Labour consulted his Department as far as it affected the Services?

Sir L. WORTHINGTON-EVANS: No, Sir; I do not think a review has taken place, because the contract was based on the figures then in existence.

Captain EVANS: Is the right hon. Gentleman aware that the Minister of Labour stated in this House only a few days ago that he did review this figure, and consulted the Trades Union Congress with reference to the alteration of the figure; and was the War Office considered in this matter?

Sir L. WORTHINGTON-EVANS: I am afraid it is not material, because the contract was based upon certain figures, and the successors of those figures still govern the contract.

Colonel APPLIN: Could my right hon. Friend explain to the House the relationship between the cost-of-living of a working man and that of an officer?

Sir L. WORTHINGTON-EVANS: I am afraid not at Question Time.

Captain A. EVANS: 71.
asked the First Lord of the Admiralty whether he is aware how the present index cost of-living figure affects the Services; and if he will consider the alteration of this figure so far as it affects the Navy?

Lieut.-Colonel HEADLAM: The answer to the first part of the question is in the affirmative. As regards the second part, I would refer my hon. and gallant Friend to the reply given by the Minister of Labour on 22nd June to the Noble Member for Shrewsbury (OFFICIAL REPORT, column 1856–7).

Captain EVANS: Have the Admiralty had any opportunity in the last six months of making representations to the Minister of Labour on this matter as far as it affects the pay of the naval forces?

Lieut.-Colonel HEADLAM: The Admiralty are perfectly well aware of the difficulty in this matter. The answer that the Secretary of State for War gave just now equally applies to the Admiralty.

CREDITS (AGRICULTURE AND FISHERIES).

Lieut.-Commander KENWORTHY: 42.
asked the Minister of Agriculture if he can report any progress with the proposal to provide cheaper credits for farmers and other agriculturists; what are the present obstacles to the introduction of the necessary legislation; and whether part of the proposed credits will be made available for the deep-sea fisheries of the country?

Mr. GUINNESS: I regret that I am not yet in a position to make any statement with regard to agricultural credit. With regard to the last part of the question, I would refer the hon. and gallant Member to the reply I gave on the 16th May last to the hon. Member for the Don Valley (Mr. T. Williams).

Lieut.-Commander KENWORTHY: Is the right hon. Gentleman aware that the reply to which he has referred me does not deal at all with deep-sea fisheries; and will he also be kind enough to answer the second part of the question?

Mr. GUINNESS: I find on reference to the reply that it did not specifically deal with deep-sea fisheries but obviously a form of agricultural credit to be advanced
on land mortgage could not be suitable for the fishing industry, where the security would only be the boats and gear.

Lieut.-Commander KENWORTHY: Will the right hon. Gentleman answer the second part of my question?

Mr. GUINNESS: I have explained that matter thoroughly in the answer to which I have referred the hon. Member. We are negotiating, but I am doubtful if it would be helpful to discuss the details of the difficulties in Parliament at this stage.

Mr. H. WILLIAMS: May I ask whether the Press agitation decrying the condition of British agriculture is crippling the Government's effort to provide credit for this industry?

Mr. GUINNESS: I am getting a good many representations that, owing to the decrying of agricultural credit, merchants are pressing farmers to pay off their debts.

Sir ROBERT SANDERS: Can the right hon. Gentleman give us any idea when he will be able to answer the first part of this question?

Mr. GUINNESS: I have said in answer to at least three questions in the last week that we are doing all we can to find a, solution, and when I have anything to announce I shall announce it.

Mr. DIXEY: Is there any possibility of its being announced this Session?

Mr. GUINNESS: I really have nothing to add to what I have said.

Lieut.-Commander KENWORTHY: With regard to the right hon. Gentleman's answer about the Press agitation, does he not think that agriculture has been helped by previous agitations, and why does he ride off by blaming the newspapers?

Mr. GUINNESS: I did not blame the Press. I was asked whether there was a restriction of credit owing to the decrying of agricultural credit, and I answered that I have had correspondence which bears out that suggestion.

Mr. E. BROWN: Does not the right hon. Gentleman think the Press is rendering a great service to agriculture by calling attention to the great difficulties under which it is labouring?

AFFORESTATION.

Mr. JOHNSTON: 45.
asked the Prime Minister whether his attention has been called to the Seventh Annual Report of the Forestry Commissioners, wherein it is declared that the planting programme being carried out does not reach the proposals contained in the Acland Report; that unless State planting can be speeded up there will be fewer than 3,000,000 acres under productive forest until the year 1955; and that this country is becoming increasingly dependent upon foreign supplies for timber and wood pulp which could be raised at home; and whether he proposes to take any steps to facilitate additional planting?

The PRIME MINISTER (Mr. Baldwin): The answer to the first part of the question is in the affirmative. The future policy of the Government in regard to afforestation is now under consideration.

DOGS (QUARANTINE PERIOD).

Lord APSLEY: 48.
asked the Minister of Agriculture whether, seeing that the maximum period of incubation of any disease, including rabies, in dogs is two months, he will consider the reduction of the present period of six months' quarantine in certain establishments approved by his Department of dogs taken from England but brought back by their owners, on the ground that many of the latter cannot, owing to financial circumstances afford to pay the necessary charges for this period?

Mr. GUINNESS: My Noble Friend is in error as to the maximum incubation period of rabies, as dogs from abroad have developed rabies from three to five and a half months after they have arrived at quarantine stations in this country. I do not consider that inability to pay the necessary quarantine charges would justify me in reducing the period of quarantine and, thereby, adding very considerably to the risk of the introduction of such a terrible disease into this country.

Captain A. EVANS: Will the right hon. Gentleman tell the House when last a case of rabies took six months to develop? Is it not the fact that this period of six months was only introduced
during the War, or immediaitely after the War, when many dogs were being brought back from France?

Mr. GUINNESS: Oh, no; and anyhow the number of dogs being brought in does not affect the period of incubation. I have many cases; in the last one, which was in 1924, the incubation took five and a half months, while the dog was in quarantine.

UGANDA (LIQUOR TRAFFIC).

Mr. HORE-BELISHA: 52.
asked the Secretary of State for the Colonies whether he is aware that a distillery has recently been started in the West African Protectorate of Uganda to facilitate the sale of intoxicating liquor to the natives; and why, in view of the provisions of the Peace Treaty, this has been permitted?

Mr. ORMSBY-GORE: I am afraid the hon. Member is labouring under some misapprehension. As regards the first part of the question, I would point out that Uganda is in East and not in West Africa. No such distillery exists; and, even if there had been a distillery erected for such a purpose in Uganda, it would not be affected in any way by the Treaty of Versailles.

Mr. WALLHEAD: Can the right hon. Gentleman say what bearing that has on the times in which we live?

Oral Answers to Questions — POST OFFICE.

SAVINGS BANK DEPOSITS (WITHDRAWALS).

Mr. COUPER: 56.
asked the Postmaster-General whether he has under consideration any proposals for introducing a cross-warrant system in regard to Post Office Savings Bank accounts and increasing the amount of deposit that at present can be drawn on demand by holders of savings bank accounts at the Post Office; and, if so, is he in a position to make any statement regarding them?

The ASSISTANT POSTMASTER-GENERAL (Viscount Wolmer): Yes, Sir, and I hope to be able to announce full particulars of these changes very soon.

TELEGRAMS, TUNSTALL (DELIVERY).

Mr. MacLAREN: 58.
asked the Postmaster-General if he will give the post
office of Tunstall, Stoke-on-Trent, the necessary authority to deliver telegrams, so as to facilitate delivery and remove the congestion now caused at the present office of delivery in Burslem, Stoke-on-Trent?

Viscount WOLMER: The arrangement recently introduced, under which telegrams for Tunstall are delivered by cycle messengers from the Burslem office, entails no delay and provides much more satisfactory accommodation for the messengers. I am informed that there is no congestion at the Burslem office; and accordingly I can see no good reason for reverting to the earlier arrangement.

Mr. MacLAREN: Might I tell the Noble Lord that I have just received intimations from fishmongers and people dealing in perishable goods, that their telegrams have been held up for one hour by the Post Office?

Viscount WOLMER: I shall be very glad to confer with the hon. Member, and go into any cases.

TRANS-ATLANTIC TELEPHONE SERVICE (CANADA).

Colonel MORDEN: 57.
asked the Postmaster-General if the fact that the United States was connected by telephone with this country before the Dominion of Canada is due to the action of the Home or Canadian authorities?

Viscount WOLMER: Since, as my hon. Friend is no doubt aware, there is no wireless station in Canada capable, at the present stage of technical knowledge of commercial telephonic working with this country, the opening of a service with the United States was necessarily the first step in establishing trans-Atlantic telephone communication.

Colonel MORDEN: Is it not a fact that the first wireless messages to America were sent through Canada?

Viscount WOLMER: Not the first, wireless telephone messages.

PONTHENRY COLLIERY (GAS OUTBURST).

Dr. J. WILLIAMS: 61.
asked the Secretary for Mines how many men were injured by the outburst of gas in the
Ponthenry colliery; and whether the precautions which were recommended by the committee of inquiry into the last outburst at this colliery have been observed?

The SECRETARY for MINES (Colonel Lane Fox): An outburst of gas and small coal occurred at the colliery on Tuesday last, when 150 men were below ground. Earth movements gave about 10 minutes' warning, and all the men were able to reach safety without injury, except that two or three were slightly gassed. The precautions laid down as the result of inquiries following the outburst in September, 1924, were observed.

ST. STEPHEN'S HALL (PAINTINGS).

Mr. JOHNSTON: 62.
asked the Under-Secretary of State for the Home Department, as representing the First Commissioner of Works, whether he is aware that the only historical picture in St. Stephen's Hall representing an incident in Scottish history deals with an act of national humiliation subsequent to the boycott of the Darien scheme by the English Government; and whether any other subject illustrative of an episode in Scots history was considered?

Captain HACKING (for the First Commissioner of Works): The subjects for the paintings in St. Stephen's Hall, depicting the Building of Britain were selected after much consideration by an eminent historian, and approved by my Noble Friend, the First Commissioner of Works, who considers that the Act of Union, so far from implying any humiliation, was a striking exhibition of the good sense of both countries.

Mr. JOHNSTON: Will the hon. and gallant Gentleman consider the advisability of affixing a tablet to that picture giving the names of the Scottish peers who were acting as Commissioners, and the amount of monetary bribes they received from the English Government for this act of national humiliation?

Captain HACKING: The names of the Commissioners are to be found in the Landbook, which can be purchased at the price of 1s. There is no suggestion, in the picture at any rate, that any money passed into the hands of the Commissioners. If any such opportunity had
been given to Scotsmen, I am quite certain they would have availed themselves of it.

Mr. JOHNSTON: Is the hon. and gallant Gentleman himself in possession of the facts with regard to the amount of monetary bribes these Commissioners received, and does he think it desirable that that act of humiliation should be the sole subject of Scottish history represented in St. Stephen's Hall?

Mr. MacLAREN: Would the hon. and gallant Gentleman consider a suggestion, to placate Scottish patriots, that we should have a painting showing the little altercation that took place at Bannock-burn between Robert the Bruce and De Bohun?

Sir H. BRITTAIN: Is it not the fact that even this picture will not keep Scots away from London?

Oral Answers to Questions — INDIA.

ZEMINDARS.

Mr. WELLOCK: 65.
asked the Under-Secretary of State for India if any changes have taken place in the basis of payment to the Indian Exchequer by the Indian zemindars under the land settlement of 1793; and, in case such changes have taken place, whether he can give a record of them?

The UNDER-SECRETARY of STATE for INDIA (Earl Winterton): In 1793, a Bengal Regulation was enacted giving the force of law to the following declaration:
The Governor-General in Council accordingly declares to the Zemindars, independent Talookdars, and other actual proprietors of land, with or on behalf of whom a settlement has been concluded under the Regulations above-mentioned [namely, the Regulations for the decennial settlement of the public revenues of Bengal, Bihar and Orissa passed in 1789 and 1790] that, at the expiration of the term of the settlement, no alteration will be made in the assessment which they have respectively engaged to pay, but that they, and their heirs and lawful successors, will be allowed to hold their estates at such assessments for ever.
That Regulation is still in force.

Mr. WELLOCK: 66.
asked the Under-Secretary of State for India what was the total annual income of the Indian zemindars
and the total sum they paid to the Indian Exchequer at the time the permanent land settlement was made in 1793, and at some recent date?

Earl WINTERTON: The total sum paid in 1793 as land revenue by the zemindars affected by the permanent settlement of that year (i.e., the zemindars of Bengal, Bihar and Orissa) was about Rs.2,85,90,000, and in 1925–26 was Rs.3,11,37,819. My Noble Friend has no information regarding their total annual income.

ASSAM TEA PLANTATIONS (WAGES).

Lieut.-Colonel HOWARD-BURY: 67.
asked the Under-Secretary of State for India the average monthly wages of men, women, and children in the Assam tea plantations during the years 1920–21 and 1925–26, respectively?

Earl WINTERTON: The average monthly wages of men in the Assam Valley Plantations increased from Rs.9 8a. in 1920–21 to Rs.12 8a. in 1925–26. The wages of women increased from Rs.8 la. to Rs.10 1a., and of children from Rs.5 la. to Rs.5 12a. In the Surma Valley the wages of men increased from Rs.7 10a. to Rs.9 12a., of women from Rs.6 2a. to Rs.7 14a., and of children from Rs.3 14a. to Rs. 5. As the figures for 1920–1921 include, whilst those for 1925–26 exclude, diet and subsistence allowances, the increase in cash earnings is greater than the figures indicate.

Oral Answers to Questions — ROYAL NAVY.

DISCHARGES AND DESERTIONS.

Mr. HORE-BELISHA: 70.
asked the First Lord of the Admiralty the number of ratings who secured their discharge by purchase and who deserted from the Navy during the year 1906, respectively; and the corresponding number during the year 1926?

Lieut.-Colonel HEADLAM: The figures for the calendar years are not available, those for the financial years are as follow:



1906–07.
1926–27.


Discharged by purchase
1,070
197


Desertions
1,896
258

Sir J. NALL: Do not these figures illustrate the sheer futility of Communist propaganda?

Lieut.-Commander KENWORTHY: Does the hon. and gallant Gentleman suggest that Communist propaganda has anything to do with any of these desertions at all at any time?

DRINKING ARRANGEMENTS.

Mr. ROBERT YOUNG: 72.
asked the First Lord of the Admiralty if he is aware that general request No. 21, A,F.O. 1346, for better hygienic drinking arrangements, where necessary, to be fitted in all ships, with particular consideration to the engine-room and boiler-rooms, was put forward by representatives of the whole of the lower deck; and will he state whether the suggestions will he carried out?

Lieut.-Colonel HEADLAM: The existing drinking arrangements on board His Majesty's ships are considered to be hygienic. It is possible, however, that some different method of supply might be more convenient to the men and any suggestions submitted through the usual channels will be considered.

Mr. YOUNG: When a request was made was not the reply of such a character that the man could not understand it?

Lieut.-Colonel HEADLAM: I cannot quite answer that question. As far as I know there is no substantial ground for the hon. Member's opinion, and what I have answered is the case. If any good suggestions can be made, we are perfectly willing to consider them.

Sir BERTRAM FALLE: Is the hon. and gallant Gentleman aware that if a man in the engine room wants a drink of water, he has to leave the engine room before he can get it?

PRE-WAR PENSIONERS (WAR SERVICE).

Mr. HORE-BELISHA: 74.
asked the Parliamentary Secretary to the Admiralty whether a naval seaman or marine who was discharged to modified pension before the great War and who subsequently returned for service during the War was allowed, after demobilisation, to count his war service for additional
pension; and if the total service entitled him to the full pension of the rank held on demobilisation?

Lieut.-Colonel HEADLAM: Pre-War naval and Royal Marine pensioners who were mobilised for service in the late War were allowed to reckon their war service for the appropriate increase of pension for which they were eligible in respect of the combined service, including time served in petty officer and higher non-commissioned ranks.

POOR LAW GUARDIANS (LOANS).

Mr. MONTAGUE (for Mr. W. THORNE): 22.
asked the Minister of Health how much of the £55,373 principal and interest payable during the financial year 1926–27 has been paid by the Bedwellty Poor Law guardians?

Mr. CHAMBERLAIN: No payment was made by the Bedwellty guardians during the financial year 1926–27 in respect of loans advanced by the Ministry.

Mr. MONTAGUE (for Mr. THORNE): 23.
asked the Minister of Health how much of the £30,688 principal and interest payable during the financial year 1926–27 has been paid by the Sheffield Poor Law guardians?

Mr. CHAMBERLAIN: The total payment made by the Sheffield guardians during the financial year 1926–27 in respect of loans advanced by the Ministry was £49,946.

Mr. MONTAGUE (for Mr. THORNE): 24.
asked the Minister of Health how much of the £328,563 principal and interest payable during the financial year 1926–27 has been paid by the West Ham Poor Law commissioners?

Mr. CHAMBERLAIN: The total payment made by the West Ham guardians during the financial year 1926–27 in respect of loans advanced by the Ministry was £108,674.

HOP PICKING (MODEL BYE-LAWS).

Captain GARRO-JONES (for Mr. BRIANT): 26.
asked the Minister of Health how many district councils have adopted
the model bye-laws issued early in 1926 for the better regulation of hop-picking areas?

Mr. CHAMBERLAIN: Eleven councils have made bye-laws based on the new model.

BUSINESS OF THE HOUSE.

Mr. CLYNES: May I ask the Prime Minister if he will state the business for next week?

The PRIME MINISTER: The business next week will be:

On Monday and Tuesday, Finance Bill—Committee.
On Wednesday, Opposition Motion of Censure on the Government relating to the House of Lords.
On Thursday, Supply, Committee: Foreign Office Vote (on which a Debate on Disarmament will take place).

On Friday, Supply, Committee: India Office Vote.

Lieut.-Commander KENWORTHY: Will the Government be able to state their intentions on Wednesday with regard to the House of Lords?

The PRIME MINISTER: It is a very short time to wait until Wednesday.

Mr. THURTLE: Can the Prime Minister say whether there is any truth in the rumour that the Government intend to refuse to give battle next Wednesday?

The PRIME MINISTER: I am afraid I did not hear the hon. Gentleman's question. I ought to have added the usual phrase, "On each day, if time permit, other Orders will be taken."

Motion made, and Question put, "That other Government Business have precedence this day of the Business of Supply."—[The Prime Minister.]

The House divided: Ayes, 224; Noes, 112.

Division No. 227.]
AYES.
[3.45 p.m.


Acland-Troyte, Lieut.-Colonel
Churchill, Rt. Hon. Winston Spencer
Hacking, Captain Douglas H.


Alexander, E. E. (Leyton)
Churchman, Sir Arthur C.
Hanbury, C.


Applin, Colonel R. V. K.
Clarry, Reginald George
Harland, A.


Apsley, Lord
Clayton, G. C.
Harrison, G. J. C.


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Cobb, Sir Cyril
Harvey, G. (Lambeth, Kennington)


Atholl, Duchess of
Cochrane, Commander Hon. A. D.
Harvey, Major S. E. (Devon, Totnes)


Baldwin, Rt. Hon. Stanley
Cockerill, Brig.-General sir George
Hawke, John Anthony


Barclay-Harvey, C. M.
Cohen, Major J. Brunel
Headlam, Lieut.-Colonel C. M.


Barnett, Major Sir Richard
Couper, J. B.
Henderson, Capt. R. R.(Oxf'd, Henley)


Beamish, Rear-Admiral T. P. H.
Craig, Sir Ernest (Chester, Crewe)
Henderson, Lt.-Col. Sir V. L. (Bootle)


Beckett, Sir Gervase (Leeds, N.)
Crooke, J. Smedley (Derltend)
Heneage, Lieut-Colonel Arthur P.


Bellairs, Commander Carlyon W.
Crookshank, Col. C. de W. (Berwick)
Henn, Sir Sydney H.


Benn, Sir A. S. (Plymouth, Drake)
Crookshank,Cpt.H.(Lindsey,Gainsbro)
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.


Bennett, A. J.
Curzon, Captain Viscount
Holt, Capt. H. P.


Berry, Sir George
Davies, Sir Thomas (Cirencester)
Hope, Capt. A. O. J. (Warw'k, Nun.)


Betterton, Henry B.
Davies, Dr. Vernon
Hopkins, J. W. W.


Boothby, R. J. G.
Dawson, Sir Philip
Hopkinson, Sir A. (Eng. Universities)


Bourne, Captain Robert Croft
Dean, Arthur Wellesley
Howard-Bury, Lieut.-Colonel C. K.


Bowater, Col. Sir T. Vansittart
Dixey, A. C.
Hunter-Weston, Lt.-Gen. Sir Aylmer


Bowyer, Captain G. E. W.
Drewe, C.
Huntingfield, Lord


Braithwaite, Major A. N.
Edmondson, Major A. J.
Hurd, Percy A.


Brass, Captain W.
Elliot, Major Walter E.
Hutchison, G.A.Clark (Midl'n & P'bl's)


Brassey, Sir Leonard
Ellis, R. G.
lliffe, Sir Edward M.


Briggs, J. Harold
Elveden, Viscount
James, -Lieut.-Colonel Hon. Cuthbert


Brittain, Sir Harry
Erskine, Lord (Somerset, Weston-s.-M.)
Jephcott, A. R.


Brocklebank, C. E. R.
Erskine, James Malcolm Monteith
Joynson Hicks, Rt. Hon. Sir William


Broun-Lindsay, Major H.
Evans, Captain A. (Cardiff, South)
Kennedy, A. R. (Preston)


Brown, Brig.-Gen. H.C.(Berks, Newb'y)
Everard, W. Lindsay
Kidd, J. (Linllthgow)


Buchan, John
Falle, Sir Bertram G.
King, Commodore Henry Douglas


Buckingham, Sir H.
Fielden, E. B.
Lane Fox, Col. Rt. Hon. George R.


Bullock, Captain M.
Forestier-Walker, Sir L.
Leigh, Sir John (Clapham)


Burman, J. B.
Forrest, W.
Lister, Cunliffe, Rt. Hon. Sir Philip


Butler, Sir Geoffrey
Foster, Sir Harry S.
Locker-Lampson, G. (Wood Green)


Cadogan, Major Hon. Edward
Fraser, Captain Ian
Loder, J. de V.


Caine, Gordon Hall
Fremantle, Lieut-Colonel Francis E.
Long, Major Eric


Campbell, E. T.
Ganzonl, Sir John
Looker, Herbert William


Carver, Major W. H.
Gates, Percy
Lougher, Lewis


Cautley, Sir Henry S.
Gault, Lieut.-Col. Andrew Hamilton
Lucas-Tooth, Sir Hugh Vere


Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)
Gibbs, Col. Rt. Hon. George Abraham
Luce, Major-Gen.Sir Richard Harman


Cazalet, Captain Victor A
Gilmour, Lt.-Col. Rt. Hon. Sir John
Lumley, L. R.


Chadwick, Sir Robert Burton
Goff, Sir park
Lynn, Sir R. J.


Chamberlain, Rt. Hon. N. (Ladywood)
Grattan-Doyle, Sir N.
Macdonnell, Colonel Hon. Angus


Charteris, Brigadier-General J.
Greaves-Lord, Sir Walter
Macintyre, Ian


Christie, J. A.
Gunston, Captain D. W.
McNeill, Rt. Hon. Ronald John


Macquisten, F. A.
Roberts, Sir Samuel (Hereford)
Tryon, Rt. Hon. George Clement


Makins, Brigadier-General E.
Ropner, Major L.
Turton, Sir Edmund Russborough


Malone, Major P. B.
Russell, Alexander West (Tynemouth)
Vaughan-Morgan, Col. K. P.


Manningham-Buller, Sir Mervyn
Salmon, Major I.
Ward, Lt.-Col.A.L.(Kingston-on-Hull)


Margesson, Captain D.
Samuel, A. M. (Surrey, Farnham)
Warner, Brigadier-General W. W


Marriott, Sir J. A. R.
Sandeman, N. Stewart
Warrender, Sir Victor


Mitchell, S. (Lanark, Lanark)
Sanders, Sir Robert A.
Waterhouse, Captain Charles


Mitchell, W. Foot (Saffron Walden)
Sanderson, Sir Frank
Watson, Sir F. (Pudsey and Otley)


Monsell, Eyres, Com. Rt. Hon. B. M.
Sandon, Lord
Watson, Rt. Hon. W. (Carlisle)


Moore, Lieut.-Colonel T. C. R. (Ayr)
Savery, S. S.
Watts, Dr. T.


Morden, Col. W. Grant
Scott, Rt. Hon. Sir Leslie
Wells, S. R.


Morrison-Bell, Sir Arthur Clive
Sheffield, Sir Berkeley
Wheler, Major Sir Granville C. H.


Murchison, Sir Kenneth
Shepperson, E. W.
White, Lieut.-Col. Sir G. Dalrymple


Nall, Colonel Sir Joseph
Simms, Dr. John M. (Co. Down)
Williams, A. M. (Cornwall, Northern)


Newman, Sir R. H. S. D. L. (Exeter)
Sinclair Col. T. (Queen's Univ., Belfast)
Williams, Com. C. (Devon, Torquay)


Nicholson, Col. Rt.Hn.W.G.(Ptrsf'ld.)
Skelton, A. N.
Williams, Herbert G. (Reading)


Nield, Rt. Hon. Sir Herbert
Slaney, Major P. Kenyon
Windsor-Clive, Lieut.-Colonel George


O'Neill, Major Rt. Hon. Hugh
Smith-Carington, Neville W.
Winterton, Rt. Hon. Earl


Ormsby-Gore, Rt. Hon. William
Smithers, Waldron
Wise, Sir Fredric


Penny, Frederick George
Somerville, A. A. (Windsor)
Withers, John James


Percy, Lord Eustace (Hastings)
Spender-Clay, Colonel H.
Wolmer, Viscount


Perkins, Colonel E. K.
Sprot, Sir Alexander
Womersley, W. J.


Perring, Sir William George
Stanley, Lieut.-Colonel Rt. Hon. G. F.
Wood, B. C. (Somerset, Bridgwater)


Peto, G. (Somerset, Frome)
Stanley, Lord (Fylde)
Wood, Sir Kingsley (Woolwich W.)


Pilditch, Sir Philip
Storry-Deans, R.
Worthington-Evans, Rt. Hon. Sir L.


Power, Sir John Cecil
Streatfeild, Captain S. R.
Wragg, Herbert


Pownall, Sir Assheton
Stuart, Crichton-, Lord C.
Yerburgh, Major Robert D. T.


Raine, Sir Walter
Styles, Captain H. W.
Young, Rt. Hon. Sir Hilton (Norwich)


Ramsden, E.
Sueter, Rear-Admiral Murray Fraser



Remnant, Sir James
Tasker, R. Inigo.
TELLERS FOR THE AYES.—


Rentoul, G. S.
Thompson, Luke (Sunderland)
Major Sir Harry Barnston and Major


Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Thomson, F. C. (Aberdeen, South)
Sir George Hennessy.


NOES.


Adamson, Rt. Hon. W. (Fife, West)
Harris, Percy A.
Short, Alfred (Wednesbury)


Adamson, W. M. (Staff., Cannock)
Hartshorn, Rt. Hon. Vernon
Sinclair, Major Sir A. (Caithness)


Ammon, Charles George
Hayes, John Henry
Sitch, Charles H.


Baker, J. (Wolverhampton, Bilston)
Henderson, T. (Glasgow)
Slesser, Sir Henry H.


Baker, Walter
Hirst, G. H.
Smith, Ben (Bermondsey, Rotherhithe)


Barker, G. (Monmouth, Abertillery)
Hore-Belisha, Leslie
Smith, H. B. Lees- (Keighley)


Barnes, A.
Hudson, J. H. (Huddersfield)
Smith, Rennie (Penistone)


Batey, Joseph
Jenkins, W. (Glamorgan, Neath)
Snowden, Rt. Hon. Philip


Bowerman, Rt. Hon. Charles W.
Johnston, Thomas (Dundee)
Spoor, Rt. Hon. Benjamin Charles


Broad, F. A.
Kelly, W. T.
Stamford, T. W.


Brown, Ernest (Leith)
Kennedy, T.
Stephen, Campbell


Brown, James (Ayr and Bute)
Kenworthy, Lt.-Com. Hon. Joseph M.
Strauss, E. A.


Buchanan, G.
Lansbury, George
Sullivan, J.


Charleton, H. C.
Lee, F.
Thomas, Rt. Hon. James H. (Derby)


Cluse, W. S.
Lunn, William
Thorne, G. R. (Wolverhampton, E.)


Clynes, Rt. Hon. John R.
Mackinder, W.
Thurtle, Ernest


Compton, Joseph
MacNeill-Weir, L.
Townend, A. E.


Connolly, M.
Macpherson, Rt. Hon. James I.
Varley, Frank B.


Crawfurd, H. E.
March, S.
Viant, S. P.


Dalton, Hugh
Montague, Frederick
Wallhead, Richard C.


Day, Colonel Harry
Morrison, R. C. (Tottenham, N.)
Walsh, Rt. Hon. Stephen


Dennison, R.
Murnin, H.
Watson, W. M. (Dunfermline)


Dunnico, H.
Naylor, T. E.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Edwards, C. (Monmouth, Bedwellty)
Oliver, George Harold
Webb, Rt. Hon. Sidney


Edwards, J. Hugh (Accrington)
Palin, John Henry
Wedgwood, Rt. Hon. Josiah


Garro-Jones, Captain G. M.
Parkinson, John Allen (Wigan)
Wellock, Wilfred


Gibbins, Joseph
Pethick-Lawrence, F. W.
Welsh, J. C.


Gillett, George M.
Ponsonby, Arthur
Westwood, J


Gosling, Harry
Potts, John S.
Whiteley, W.


Graham, D. M. (Lanark, Hamilton)
Purcell, A. A
Williams, C. P. (Denbigh, Wrexham)


Greenall, T.
Riley, Ben
Williams, David (Swansea, East)


Greenwood, A. (Nelson and Colne)
Roberts, Rt. Hon. F. O.(W.Bromwich)
Williams, Dr. J. H. (Llanelly)


Grenfell, D. R. (Glamorgan)
Robinson, W. C. (Yorks,W.R., Elland)
Wilson, R. J. (Jarrow)


Grundy, T. W.
Rose, Frank H.
Windsor, Walter


Hall, F. (York, W. R., Normanton)
Runciman, Rt. Hon. Walter
Wright, W.


Hall, G. H. (Merthyr Tydvil)
Salter, Dr. Alfred
Young, Robert (Lancaster, Newton)


Hamilton, Sir R. (Orkney & Shetland)
Shepherd, Arthur Lewis



Hardle, George D.
Shiels, Dr. Drummond
TELLERS FOR THE NOES.—




Sir Robert Hutchison and Mr. Fenby

HASTINGS TRAMWAYS COMPANY (TROLLEY VEHICLES) BILL [Lords].

Reported, with Amendments.

Report to lie upon the Table, and to be printed.

GRAVESEND, ROSHERVILLE, AND NORTHFLEET TRAMWAYS (AMENDMENT) PROVISIONAL ORDER BILL.

Reported, with Amendments [Provisional Order confirmed].

Report to lie upon the Table, and to be printed.

Bill, as amended, to be considered To-morrow.

SELECTION (STANDING COM- MITTEES).

STANDING COMMITTEE A.

Mr. WILLIAM NICHOLSON: reported from the Committee of Selection; That they had discharged the following Member from Standing Committee A: Viscount Elveden; and had appointed in substitution: Lieut-Colonel Windsor-Clive.

Report to lie upon the Table.

MESSAGE FROM THE LORDS.

Mr. WILLIAM NICHOLSON: That they have passed a Bill, intituled, "An Act to make such amendments of The Workmen's Compensation Act, 1925, as are necessary to give effect to a certain resolution adopted by an Imperial Conference held in London in the year nineteen hundred and twenty-six." [Workmen's Compensation (Transfer of Funds) Bill [Lords.]
And also, a Bill intituled, "An Act to vary the trusts, powers, and provisions of two several settlements, both dated the seventeenth day of August, one thousand nine hundred and twenty, and executed on the marriage of Ralph Frederic Bury and Violet Esmé Bentley." [Bury Estate Bill [Lords].
Ouse Drainage Bill,—they have appointed a Committee consisting of five Lords to join with a Committee of the Commons to consider the Ouse Drainage Bill, pursuant to the Commons Message of Monday last, and they propose that the Joint Committee do meet in Committee Room No. 1, on Tuesday the 12th of July next, at Eleven o'clock.
Rabbits and Rooks Bill [Lords],—That they request that the Commons will be pleased to give leave to Sir Edmund Turton, baronet, a Member of their House, to attend, in order to his being examined as a witness, before the Select Committee appointed by their Lordships in the present Session of Parliament on the Rabbits and Rooks Bill [Lords].

BURY ESTATE BILL [Lords].

Read the first time; and referred to the Examiners of Petitions for Private Bills.

OUSE DRAINAGE BILL,

So much of Lords Message as refers to time and place of meeting considered.

Ordered, That the Committee appointed by this House do meet the Lords Committee as proposed by their Lordships.£(Commander Eyres Monsell.)

Message to the Lords to acquaint them therewith.

RABBITS AND ROOKS BILL [Lords],

So much of Lords Message as requests the attendance of Sir Edmund Turton, baronet, considered:—

And, Sir Edmund Turton having consented, leave given.

Orders of the Day — FINANCE BILL.

Further considered in Committee [Progress, 28th June].

[Mr. JAMES HOPE in the Chair.]

CLAUSE 9.—(Customs duty on translucent or vitrified pottery.)

Mr. SNOWDEN: If I may be permitted to do so, I would like to ask the Chancellor of the Exchequer if he will make any statement as to how far he proposes to proceed to-day. There is a number of what I might call minor Amendments on the Order Paper, but there are two or three of major importance. There are the Clauses for dealing with the evasion of Super-tax. I understand that that is a matter in which hon. Members opposite are extremely interested, and I think it would be very undesirable that we should be dealing with these important proposals at a late hour. Therefore, I would ask the Chancellor of the Exchequer whether he has considered that matter, and, if so, has he any statement to make to the Committee?

The CHANCELLOR of the EXCHEQUER (Mr. Churchill): I have been giving consideration to the point which the right hon. Gentleman has raised. Personally, I hold very strongly the view, and have always held it, that we should try to arrange our business to bring on important Debates at times when the fullest publicity can be obtained, and that the crucial issues should be debated on the best occasions. I would therefore propose, if the Committee would agree, that when we reach Clause 28 I should move to postpone consideration of Clauses 29 to 34 inclusive, which are the Clauses dealing with Super-tax and its evasion, and that they should he considered after Clause 45. Then we should endeavour to make what progress we could, and of course the Government attach the greatest importance to getting as far as Clause 45 to-night. There is really nothing of a controversial character in the various intervening proposals, and a great many are in the nature of technical provisions. That would enable
us to get the discussion of the evasion Clauses on Monday next in the best circumstances, and after that we could deal with the Road Fund. There will be a day for the new Clauses, with regard to which, I understand, it is intended and desired to have a very definite Debate upon the Betting Duty, raising the whole position. I think that is much the best division of our time, and I understand there is no difficulty whatever in the way of precedent for making this Motion. Very often a Motion is made to postpone a Clause to the end of the Bill, but a precedent exists for postponing a Clause or group of Clauses, not to the end of the Bill, but to a particular point of the Bill. I find that in 1908, when I was in charge of the Port of London Bill, I said:
I am very anxious indeed that the crucial and fundamental Clauses of this Bill, of which, perhaps, Clause 3 is the most important, should be discussed in the House at the best period for publicity and criticism.
I then moved that that Clause should be postponed until after Clause 11 had been considered, to which the House gave its assent. I shall therefore propose to repeat that process this evening, and for exactly the same reason, by moving that Clauses 29 to 34 be postponed until after consideration of Clause 45, so that we can begin to debate the important evasion proposals on Monday, if that would be convenient to the Committee.

Mr. SNOWDEN: Of course, it is impossible to say what length of time the discussion to-day may take. It might possibly happen that we might reach the end of Clause 27 about 11o'clock this evening, and, in that case, it might not be necessary for the Chancellor of the Exchequer to make this Motion then, as we could begin Clause 28 on Monday.

Mr. CHURCHILL: I am afraid that would not do. There is very little in between to cause any trouble at all, but we must get it out of the way if we are to secure the good opportunities for debating evasion, the Road Fund, and the Betting Duty.

The CHAIRMAN: I think I ought to point out what is quite a small technical point, that the proper time to move to postpone Clauses is after the last Clause is disposed of, and in this case that would
be after the Question, "That Clause 28 stand part of the Bill," has been agreed to. Also, under the Rules of the House, it will be necessary in that case to move to postpone each Clause.

4.0 p.m.

Mr. RUNCIMAN: The arrangement which the Chancellor of the Exchequer has described is one which on other occasions might very favourably be adopted. It is, perhaps, the best way of obtaining a full discussion of one of the most important parts of the Bill, and in so far as we can facilitate that procedure, we shall do all that we can to help.

Mr. PETHICK-LAWRENCE: Before we go on to deal with pottery, it might he for the convenience of the Committee if you, Mr. Hope, were to tell us what procedure you propose to adopt with regard to this discussion.

The CHAIRMAN: I propose to call upon the hon. Member to move the first Amendment—to leave out the words "five years" and to insert instead thereof the words "one year." I think it will be convenient, and in accordance with the usual practice, that we should have a general discussion on the Clause on that Amendment. I also propose to call this Amendment—in line 7, to leave out the words "or vitrified pottery." With regard to the Amendment of the hon. Member for Orkney and Shetland (Sir R. Hamilton)—in line 4, to leave out the words "nineteenth day of April," and to insert instead thereof the words "first day of July"—and the Amendment of the hon. Member for West Leicester (Mr. Pethick-Lawrence)—to leave out the words "nineteenth day of April," and to insert instead thereof the words "first day of May"—I am not very favourably disposed towards them. It appears to me that they are more suitable for discussion on the Resolution imposing the duty. I can see that the former would involve repayment of the whole quarter's revenue. The latter would also involve repayment of a very much smaller amount, and I am not very well disposed to accept those two Amendments.

Mr. PETHICK-LAWRENCE: So far as my Amendment is concerned, it is not intended as a destructive Amendment.
It has been put down at the special request of those who are very much interested in this matter. It involves a very small concession, and I had hopes that, after hearing the case I should put forward, the Government would be willing to concede it. I hope, therefore you will consider whether that particular Amendment could not be allowed.

Mr. HARRIS: I did not intend to press the Amendment standing in the name of the hon. Member for Orkney and Shetland and myself. I was quite prepared to ask you, Mr. Hope, to allow me not to move it, but I feel that the other one is not really controversial and that the hon. Member for Leicester (Mr. Pethick-Lawrence) could justify it.

The CHAIRMAN: It has reference to duties on goods that were coming into the country at the time. I think I will be disposed to accept that, but not the Amendment standing in the names of the hon. Member for Orkney and Shetland and the hon. Member for Bethnal Green (Mr. Harris).

Mr. PETHICK-LAWRENCE: I now beg to move, in page 5, line 3, to leave out the words "five years" and to insert instead thereof the words "one year."
I am much obliged to you, Sir. I think we shall have an important discussion when we come to that point on the Paper. The ostensible object of the Amendment I now move is to limit the period for which this new duty on pottery runs, from five years to a single year, but I understand that, in accordance with your ruling, the Committee will be entitled to discuss the whole question of the Pottery Duties on this Amendment. When the subject was before the House in the form of the Money Resolution on Report, there was one feature of the position of the Government that was very noticeable on this side. It seems very likely that it will be repeated to-day. I refer, of course, to the absence of the Chancellor of the Fxchequer, and I venture to ask why is that the Chancellor of the Exchequer is always absent when these safeguarding duties are under discussion. I venture to supply the answer. The answer is, in my opinion, that he knows too much about these safeguarding proposals. It has been a matter of observation to myself, and I think to other hon. Members,
that it is when the knowledge of the Chancellor of the Exchequer is least that his speeches are the most alluring, at any rate, to hon. Members on the opposite side of the House. We recall his attitude on Monday, on the question of the gold supply, and there are many other occasions which bear out that view.

The CHAIRMAN: I am allowing a general discussion on the Pottery Duty, but not a general discussion on the Chancellor of the Exchequer.

Mr. PETHICK-LAWRENCE: I am very sorry to have offended, but I was only making a slight introduction to what I was going to say with regard to the attitude of the Chancellor of the Exchequer towards the Pottery Duties. That, I think you will admit, is in order. The Chancellor of the Exchequer knows quite well that these safeguarding duties are, in fact, pure and unadulterated Protection, and, although his feet have led him into the Conservative camp, his brain holds him still a Free Trader. If I might paraphrase the adage, one might say of him:
Whose brain rebels against his will Remains of the same opinion still.
For that reason, he seeks safety by staying away from these Debates, but, although the Chancellor of the Exchequer has gone away, our Debate is to be graced again, as it was before, by the presence of the President of the Board of Trade. The attitude which the President of the Board of Trade takes towards us on this side, on this safeguarding question, is something of this kind: "I am not arguing; I am telling you." The reason that the President of the Board of Trade is not prepared to argue, is because he cannot defend these duties by argument on their merits. The Committee is well aware that the President of the Board of Trade is himself a Protectionist, and he would like to defend these duties on the ground of protection. He cannot do that, however, and the reason is not solely because of the Prime Minister's pledge, but because he knows quite well—probably better than I do—that, if he were to defend these taxes on Protectionist grounds, he would make an additional rift in his party and widen the one which had already developed. But apart from that, why does he not defend this tax as a
safeguarding tax? The reason for that is that that also is impossible, because, by all the tests which the White Paper relating to safeguarding imposes, this particular duty on pottery has failed. That is why, on the last occasion, we had the President of the Board of Trade, instead of defending the new taxes on their merits, coming to us and saying something of this kind: "Have we not done all that we are required to do under the Prime Minister's pledge? We have set up a committee, the committee have come to a decision, and now the House has just got to swallow the decision of the committee." I have slightly paraphrased his words, and have used the words "swallowed a decision of the committee," but I think that is amply justified by the facts.
The committee reported on 8th April. The Chancellor of the Exchequer declared his intention of putting on these taxes in the Budget of 11th April. The only chance that the House or the Committee could have had of discussing them was during that week, and, as a matter of fact, they were not discussed until 28th April, and they had already come into force on the 18th. There were only 11 days between the report of the committee and the date on which these duties actually came into operation. Therefore, I think I was right in saying that the position taken up by the President of the Board of Trade is that, if a committee issue a report, then both the Chancellor of the Exchequer and the House must be expected to swallow the findings of that committee, and come to a decision in their favour without any real separate investigation or consideration of the question. The President of the Board of Trade says, "If you do not like that procedure, so far as I am concerned, I am willing to scrap it and have the Chancellor of the Exchequer, in consultation with myself, putting on any duties which we think desirable."
I have already pointed out the reasons which, I think, prevent the Government and the President of the Board of Trade taking that course. The fact is that the procedure of the White Paper contemplates something totally different from what the President of the Board of Trade would have us believe. The procedure there indicated is to the effect
that any application for one of these duties must pass certain tests, and that is not satisfied if you merely have a majority of two to one of a specially appointed committee taking that view. It will only satisfy the required tests if, competent authorities, a decision of the committee is reviewed and accepted after all the facts have been taken into account. That is particularly true with regard to this question of pottery.
Anyone who has gone in detail into the evidence brought before that committee, and has read the report, cannot fail to observe that, as a matter of fact, the findings were entirely contrary to the evidence. If the Chancellor of the Exchequer had fulfilled his duty, and allowed a little time to elapse between the report and coming to the decision, and also allowed the House time to examine the facts, they would come to the view which I have already given. But when the subject was before the House on the Report of the Money Resolution, we on this side went in great detail into the way in which these duties conflict with the test imposed by the White Paper.
So far as I am concerned, I have no intention of repeating the details which I and other Members, both above and below the Gangway, gave on that occasion. I propose to confine myself to two main points. The first point is this, that the articles which these duties propose to tax are not, in the main, in competition with the articles which it is hoped thereby to protect. They are in competition with different articles, the manufacturers of which do not ask for protection at all. The articles which it is suggested that these duties are imposed to protect, are broadly summed up in what is known as Longton china. If the Committee goes into the facts with regard to the sale of Longton china at the present time, they will discover that, since the War, the producers or Longton china have chosen to make of their industry a luxury trade. While the cost of labour in that trade has gone up about 80 per cent., and while many of the raw materials have gone up by about the same extent, and all except one of them have gone up by less than 100 per cent., the prices charged to the consumers of Longton china are, according to the manufacturers'
own admission, not less than 125 per cent. above pre-War. Those who have gone into it will agree that, in many cases, they are much more than that, and are 150, 175 and even 200 per cent. above pre-War.
It stands to reason that people in these days are not prepared to pay twice or three times what they were asked to pay before the War, when they can obtain other articles which for their purposes are just as good, and which they can obtain at a very much lower price. These cheaper articles come in from abroad in the form of felspar china and are manufactured at home in the form of earthenware. People can obtain articles of felspar china or earthenware for something like one-third the price they are expected to pay for Longton china. It has been alleged by those who defend this duty that the reason why these articles of bone china, Longton china, are so much dearer than articles of felspar china, on which it is proposed to put the duty, is that the wages paid abroad are much lower than the wages paid here. I believe that was the ground on which the majority of the Committee came to their findings; but the wages question has little or nothing to do with the discrepancy in prices. The articles of Longton china are so immeasurably dearer than articles of felspar china that even if you were to wipe off the whole of that part of the production of this home article which is due to wages, you would not bring the price down to anything like the price of the foreign imported article. On that point, I will quote the remarks made by the counsel against this duty, at the examination. He said:
If you take the cheapest factory making bone china in Longton, of which we have heard anything, and if every individual in it, from the managing director down to the youngest operative. including the commercial travellers. worked free and for nothing, the cost of bone china"—
that is, Longton china—
would still he greater and in some cases twice as dear as the cost of a similar article in felspar china made in Germany.
I would remind the Committee that that statement was upheld by the Chairman of the Committee, who ultimately agreed to the imposition of the duty. He said:
Taking the figures given to us for Canada, and working them out in one's head. I think that that is so.
Therefore, as a matter of fact this pretence that the duty is being imposed upon foreign imported china in order to countervail the difference in wages is exploded, because even if the British workers worked for no wages they still would not be able to compete with this foreign-imported article. The real competition is not between the felspar china which comes from abroad and the Longton china manufactured in this country, but between the felspar china which comes from abroad and the earthenware which is manufactured in this country, and the important fact has to be realised that the earthenware manufacturers in this country did not ask for protection and did not appear before the Committee. I do not know exactly the reason for taking that view, but I can only suppose that they thought that protection in respect of the importation of felspar china would injure the earthenware manufacturers' trade either by injuring the home market or by injuring their chance of getting trade by exports.
We who oppose this duty have nothing to say against the excellence of the Longton china. We realise that Longton china consists of some of the most beautifully manufactured china in the world, and that it rightly holds a very honoured place, but if it is to be produced in anything like the way as at present it is bound to have a limited market. It is open to the manufacturers themselves to decide whether they will cater solely for the market of the rich or whether they will cater for the market of the rich and the middle classes. The policy which they have adopted by forming a ring and keeping up prices has had the effect of restricting their own market. That is not our business. If they choose to take that course they are entitled to do so, but they are not entitled to make that an excuse for interfering with the table necessaries of the working people of this country. That brings me to my second point, and that is, the repressive character of the duty which it is now proposed to impose. The position in regard to this duty is that the cheaper the cup the greater is the tax, and not merely the greater in proportion to its actual value. This tax is put on weight. The cups, saucers and table-ware generally used by the working classes are thicker and heavier than the better
material; therefore the people who use these articles have to pay a duty which is not merely greater ad valorem, but actually greater per piece than the duty on the better material. In fact, on the cups and saucers and plates that are bought, say, by the labourers in this country the duty works out at something from 70 to 100 per cent., whereas on the thin and beautiful china of the best quality it gets down to below 10 per cent., and I believe I am right in saying that it gets down to as low as 2 or 3 per cent.
It is only by adding together the article worth several pounds, which is taxed two or three per cent., with thousands of articles of the cheap kind which are taxed 70 to 100 per cent., that the figure of 28 shillings per cwt. is said to average 33⅓ per cent. There is a great danger in taking averages in this way. I am reminded of the story of a man who went to dine at an inn and was given what the innkeeper told him was rabbit pie. When he came to eat the pie he found in it parts that did not belong to a rabbit, and he came to the conclusion that he had been put off partly with horse pie instead of rabbit pie. He went to the innkeeper afterwards and complained. The innkeeper admitted that there had been horse in the pie as well as rabbit, but he added: "Never mind, at any rate it is horse and rabbit pie fifty-fifty." "What do you mean by fifty-fifty?" asked the man. "One horse and one rabbit" replied the innkeeper. That illustrates the danger of averages. It is said that the 28 shillings per cwt. duty is really the equivalent of 30 per cent. ad Valorem for practical purposes, but so far as the working people of this country are concerned, and they will have to pay the great bulk of this tax, that is a pure snare and delusion. As a matter of fact, they are being asked to pay 50, 60 or 70 per cent. on the kind of materials which they actually have to use, and it is only by introducing the lower percentages on the high value articles that the average can be brought down.
What are the effects that are likely to arise from this taxation? It will have practically no effect upon the industries in Longton. I do not believe that there are any grounds for thinking that this taxation will beneficially affect the Long-ton manufacturers. What will be the
effect upon the consumers? It will add to the tax on sugar, a tax on the sugar basin. It will add to the tax on tea a tax on the teapot. The other day, the Chancellor of the Exchequer defended the tax on motor tyres on the ground of symmetry. I suppose, on that principle, this duty will be defended on the ground that it makes the breakfast table taxes symmetrical; because it taxes the crockery materials on the table as well as the food which is eaten from them. The effect will be that the poorer classes will buy fewer of these articles. When a cup is chipped they will continue to use it, and when a plate is cracked it will have to remain part of the household utensils. This taxation will involve maintaining a chipped cup and a cracked plate. That will not only be bad for the people who have to eat from these utensils but it will be bad—this will appeal to hon. Members opposite—for trade. If goods are cheap and when they get a little injured they can be replaced without much cost, people will go on buying. That is largely the cause of the prosperity in the United States. People can buy cheaply and usually they more quickly discard things which are a little worn out and buy new ones. This policy of taxing the imports of cheap crockery will have the effect of raising the price of these simple household utensils and will make people buy less, and because it will make people buy less it will be bad for the earthenware trade of this country. That, no doubt, is one of the reasons why the earthenware manufacturers did riot appear before the committee and ask for the duty.
I ask the Committee to accept this Amendment because I do not believe this duty will bring prosperity to the china trade at Longton but rather that it will bolster up that industry in making their trade a luxury trade, because it will bring added hardship to the working people of this country, and because it is a tax which increases with the poverty of the people who have to buy. That being so, we on this side will vote for the Amendment to limit the evil effects of the proposed taxation.

Sir ROBERT HAMILTON: The more one considers this proposed taxation the less justification one can see for it. There are various points from which the
tax can be criticised, but I propose to confine my remarks more particularly to the way in which the tax is imposed. It is suggested that the tax should be imposed on weight. when that is worked out, it is perfectly obvious that the result is something quite different from that which the Committee intended. The Committee said that they intended to impose a tax of about 33⅓ per cent., but in practice we find that in applying their manner of taxation by weight the tax goes up to anything from 40, 50, 60, 70 to 100 per cent., and that in proportion as the articles become cheaper. The more expensive article bears less of the tax, while the cheaper article bears the higher proportion of the tax.
I should like to ask the President of the Board of Trade if he intends to attempt to justify the imposition of the tax in this manner. Is he going to argue that this manner Of imposing the duty does, in fact, result in a duty of 33⅓ per cent? I ask the right hon. Gentleman does this method of imposing the duty work out in practice in the way in which the Committee suggested it would work out?

The PRESIDENT of the BOARD of TRADE (Sir Philip Cunliffe-Lister): I will deal with that point in my reply.

Sir R. HAMILTON: We shall be very pleased to hear the arguments of the President of the Board of Trade, because in all the figures supplied by anyone connected with the trade it is obvious that this is not the case. The most conservative figures, taken over a large area, show that it will be a duty of 60 per cent. rather than 33⅓ per cent., and, if it be intended that the duty should work out at merely 33⅓ per cent., the method of imposing the duty should be modified. It does seem to me most extraordinary that, when it is desired to put on a protective tax of this character, it should be put on according to the weight of the goods, especially when we are dealing with a class of goods like china and when we know that the highest quality of finished article is the, lightest and that it is obvious that the duty must fall with a very heavy weight on the cheap article. Therefore, the imposition of this duty will put a heavy burden on the poorest class of the community. You cannot get away from it that the highly-finished article bought as a luxury in Bond Street
pays an infinitesimal tax, while the cheap jug, the cheap mug and the cheap cup will bear a heavy tax running to 50, 60 and 70 per cent. I really think this is one of the most extraordinary examples of all the extraordinary examples we have had in this White Paper, and the Board of Trade have given us no justification for imposing the duty according to this method. There is no justification to be found for an arrangement according to which the cheapest article bears the heaviest burden of taxation, and it cannot be too widely known that this is not a 33⅓ per cent. duty. It is infinitely more than 33⅓ per cent. I ask the President of the Board of Trade if it is intended to impose a heavier duty than the Committee recommended. The Committee recommended a 33⅓ per cent. duty, but, as I say, it will work out at infinitely more than 33⅓ per cent. if the duty is imposed on the weight of the article. It will work out at twice or three times as much as the Committee themselves recommend.

Sir P. CUNLIFFE-LISTER: The case against this Clause is founded upon two grounds. The first which was advanced by the hon. Member for West Leicester (Mr. Pethick-Lawrence) was that it does not comply with the conditions of the White Paper. He said that, having detailed the arguments on a former occasion, he did not propose to repeat them. But as he has made that general charge I want to reply generally to the charge, because I equally replied at some length on the last occasion on which we discussed this Clause. The conditions of the safeguarding procedure laid down in the White Paper have been complied with. No one will deny that the industry is one of substantial importance—it employs 7,200 people. The imports of pottery have grown rapidly during the last six years and now exceed the average for pre-War years. The imported article is sold at prices at which it is not possible to produce similar articles in this country, and the Committee found that the wages paid in Germany and Czechoslovakia are lower than in this country. Then it is said that the imports of china are not excessive. The Committee showed in their Report that imports were excessive at the time of their Report, and they have since increased. The second ground on which the case against this
Clause is founded is that the imported and the home produced articles do not compete. On the last occasion, we had a most interesting demonstration by the hon. Member for Bethnal Green (Mr. Harris) who produced a series of plates and cups, and I myself was also armed with a similar battery, and I defied any Member of this Committee to distinguish between felspar, and bone china. There is a different process employed in the manufacture of these two kinds of china, and there is a difference in the component materials, but it is not that kind of scientific analysis which determines people when things are similar in appearance when they see them on the shop counter to purchase one or the other. The ordinary purchaser is content to buy what pleases him—

Notice taken that 40 Members were not present; Committee counted, and 40 Members being present—

Sir P. CUNLIFFE-LISTER: That is the real test of competition which any practical person will apply. [An HON. MEMBER: "That is no reason why poor people should be taxed!"] I am dealing with the point raised by the minor Opposition. I now come to the charge made by the hon. Member for West Leicester with regard to the question of the volume of imports. Now there, the case is plain. Production in the home industry has been going down, and it would have been still lower were it not for the preference given to it in certain Empire countries which enabled us to do a trade which otherwise we would have been handicapped in doing. According to page 9 of the Report of the Committee, the home production of Longton china was in 1913, 1920 and 1921 considerably higher than it is at the present time. The estimated net imports of chinaware averaged 300,342 cwts. from 1909-1913. In 1913, the imports amounted to 341,511 cwts. The imports decreased in the years 1920 to 1925, but in 1926 they amounted to 365,131 cwts. I will bring the figures more up to date. The importation in the earlier months of this year showed, again, a progressive increase. It was 39,000 cwts. in January, 39,000 in February, 46,000 in March and 49,000 in April. Then it dropped owing to the duty.

Sir R. HAMILTON: Does that include earthenware?

Sir P. CUNLIFFE-LISTER: No. It follows the same classification that is adopted in the table owing to the difficulty of separating china from earthenware. The figures I am giving now are strictly comparable with the table set out on page 9. Therefore, when you come to the volume of competition, you will find that the imports are progressively greater while the home production is diminishing. That is one of the cardinal facts you must consider in regard to the White Paper in considering whether the conditions of the Committee are being carried out. On that, I think there is no dispute. The wages in Germany and Czechoslovakia are very much lower than the wages in this country. They are set out in page 14 of the Report. The average rates of wages for men and women employed in the china section of the industry in this country are about £3 9s. 9d. and £1 12s. 9d. per week, respectively, for a full 47-hour week. The average hourly rates are 1s. 5.82d. for men and 8.36d. for women. It was asserted by the applicants that the wages in Germany for skilled men were between 8½d. per hour in the case of time-workers and 10d. per hour for piece-workers. In Czechoslovakia the wages are lower still. Wages in both of these countries are about 50 per cent. of the cost, but the hon. Member says that because some of the raw material is cheaper abroad than in this country it is still more difficult for this country to compete with them. That is an argument to which I cannot for a moment assent, because if you really consider that the standard of wages is lower in the competing countries than here it makes the case for a duty stronger and not weaker. I should have thought, therefore, that the case was abundantly made out in the White Paper. Another consideration to be considered under the White Paper is whether you are likely to cause injury to any other industry in this country. It has been sometimes debated at length in this House that the finished article is more properly subject to duty than a partly manufactured article connected with some other industry. Now here is an article which is a finished one and cannot enter into any other industry unless you say that it is the [...]raw, material of a hotel keeper so far as he keeps table ware on his table.
I submit that on all these grounds there is a clear case made out in favour of this industry, and I am glad to say that even though the duty has been in operation a short time only, so far from it being clear that no help can be expected from the duty by the industry, I understand that manufacturers are getting inquiries of a kind which they have not experienced for years past. Then it is said you ought not to impose a duty because there was a ring in this industry. The allegation is very easy to make, but this happens to be an industry in which employers and workers are most closely related and have a joint industrial council in which every difficulty is treated in common and thrashed out in common. But the charge of a ring was made to the Committee and that Committee said:
We are aware that, there is some agreement among the English bone-china makers which includes the fixing of minimum selling prices, but owing to the numerous graduations of quality and the large sale of "Seconds," it is clear that nothing in the nature of 'ring' prices exist.
I prefer that considered judgment to the statement of the right hon. Gentleman. I submit on these grounds there is a complete answer to the complaint that a case has not been made out under the White Paper. I say that the case for the duty is made out under the whole of the White Paper and I am sure—I have said this before and I adhere to it—it is wholly unreasonable to strain the meaning of the White Paper against the imposition of the duty. If the right hon. Member for Spen Valley (Sir J. Simon) would consider to matter impartially, the one charge he simply cannot make against the Government is that they do not impose strict conditions.These conditions are a very stiff interpretation of the Prime Minister's pledge. If the stringent conditions of the White Paper are satisfied, we plainly are guilty of a gross breach of the Prime Minister's pledge if we refrain from inviting the House to impose the duty. The hon. Gentleman the Member for Orkney and Shetland (Sir R. Hamilton) dealt with another ground. He said, "I accept what has been said by the other speakers as to reasons why you should not impose a duty." Then he said, "You are going to impose a duty of 28s. a cwt., and you ought to
impose the duty which the Committee recommended." The Committee did recommend a duty of 28s. a cwt. The Committee says:
We have consequently considered the possibility of a specific duty and have come to the conclusion that the duty of 28s. per cwt. would he approximately equal to an ad valorem duty of 33⅓ per cent. on the main classes of pottery to which the application relates.
The opponent said that as between the two duties they would prefer to have a specific duty rather than an ad valorem duty which might press hardly upon grades of china in which competition was not severe. The Government were meeting the convenience of the importers by this duty. This hon. Gentleman says a specific duty is wrong, and that you must not put on this particular specific duty because it works out too high. Any specific duty that is imposed must in some cases be below and in some cases above, but I have carefully examined the matter, and about as good an example as I can take of what this duty in fact does is the example of a sample produced by the London Chamber of Commerce. It was a 975 cwt. consignment. It was a sample produced by a gentleman who was a principal witness on behalf of the opponents. He claimed that the comparison which has been given has been a comparison of duty on the works' costs of some foreign firm. But the 33⅓ per cent. duty will not be levied upon the figure equal to the cost at the foreign works. The specific duty will be levied like an ad valorem duty on the c.i.f. value which of course has a figure of something like one-third added on to the works cost. As a matter of fact, taking that particular sample which was produced, we found that it worked out on the average that the c.i.f. value would be £3,981 on 975 cwt., and a duty of 28s. a cwt. would be £1,365, which was just a little over 34 per cent. on the c.i.f. value. That is a pretty good test. In another case which was taken, one finds that with cups and saucers where prices varied from 4s. 2d. to 5s. 3d. per dozen with 28s. a cwt. it worked out at 1s. 6d. a dozen, and the duty would range from 36 per cent. on cups and saucers at 4s. 2d. a dozen to 28 per cent. on cups and saucers at 5s. 4½d. a dozen. Those are pretty good general test cases, but there was one case raised on the last occasion
by the right hon. Gentleman the Member for Spen Valley (Sir J. Simon), who produced a specific example of a tea-set from Woolworths, and said this would be a perfectly enormous duty and that it would work out at exactly 50 per cent. The particular set he quoted was to cost 3s. 1½d. each. This is a specific case. I do not pretend to trace the specific set, but I am told that whatever may be the price at which Woolworths are buying, there is a similar tea-set sold by them at 9s. to-day so that whatever the rate of duty on the cost price, it works out instead of to 50 per cent. to less than 18 per cent. on the retail price. If that is the best kind of case that can be made out against this duty, I do not think it is a very substantial case, and therefore I ask the Committee to stand by the proposal that the duty of 28s. a cwt. should be taken as a fair arid reasonable equivalent of the duty of 33⅓ per cent. on the c.i.f. value. If you had a duty which is at once a specific duty and an ad valorem duty, and you now charge the one and now the other, that would involve the Customs in difficulties over mixed consignments in order to decide on which the duty should be paid. That would make matters worse.

5.0. p.m.

Mr. SNOWDEN: The right hon. Gentleman is alwaye interesting and his innocence is rather captivating as is also his simplicity. I have never listened to a right hon. Gentleman whose speeches were always so wholly packed with fallacies. I am wondering whether he has convinced himself of the truth and accuracy of the arguments he puts forward. He is trying to justify this duty on the ground that the recommendation of the Committee justifies it an each of the five heads of the White Paper. He claimed that nothing could be fairer than the conditions laid down by the Government for this Committee's investigations. We are not now complaining about the terms of the White Paper; we are complaining that the terms of the White Paper and the Terms of Reference of the Committee were wholly ignored by the Committee itself. We are, therefore, not bound to accept the recommendations of the Committee or its views. I am not aware of a case—there may be a case, but I am not aware of it—where a Committee has recommended the imposition
of a duty, and the Board of Trade has not accepted the recommendation. But the circumstances in which this Committee submitted its Report, the recommendations of which were accepted by the Board of Trade and incorporated in this year's Finance Bill, constitute little less than a scandal. A day or two after this Report had been published, the Chancellor of the Exchequer announced in his Budget speech that he was proposing to include the recommendations in the Finance Bill. I will do the Chancellor of the Exchequer the justice to say that he made that announcement in his most contemptuous manner. He made no comment on it, except by the scornful tone of his words. He simply announced that this duty would be imposed. In fact, as my hon. Friend the Member for West Leicester (Mr. Pethick-Lawrence) pointed out, the Chancellor of the Exchequer has never been here, heard either by word of mouth or by his pre-sence, to support this Resolution, but he has left the case to the President of the Board of Trade, and that gives further support to the impression we have, which is derived from the manner of the announcement by which the Chancellor of the Exchequer proposed the imposition of these duties. They are, of course, purely protectionist in their action.
The President of the Board of Trade went through the five heads of the Terms of Reference to the Committee which are embodied in the White Paper, and tried to prove that this duty had been justified under each of those five headings. I am not prepared to dispute the statement, and it is a matter of no relevance to this duty, that this industry is one of substantial importance. Of course the word "substantial" is very vague and indefinite, but we will not waste time in discussing that first point. Then we get to the second point, as to whether this duty was justified on the ground that there had been an increase in imports of a competitive character. I listened to the President of the Board of Trade when he was attempting to go through that part of the Committee's recommendations. Nothing could be plainer than the fact that there has been no increase in imports of a competitive character. The President of the Board of Trade
called attention to some figures which appear, I think, on page 9 of the Committee's Report.
I do not know if members of the Committee have got the Report of that Committee in their hands, but if they have they will see that the figures there laid down are figures giving the imports of chinaware from 1909 to 1926, and that from 1909, with one single exception—the year 1926—there has been a progressive decline in the imports of chinaware. In 1909 to 1913 the average net imports of chinaware are stated to be 30,626 cwts., and those figures then drop—the War figures, when the circumstances were quite abnormal are excluded—to a figure of 20,000 odd in 1920, then 10,000 odd in 1921, 10,000 odd in 1922, 11,000 odd in 1923, 10,000 odd in 1924, and 5,000 odd in 1925. "Ah, but," says the President of the Board of Trade, "lock at the figures for 1926." Yes, the figures for 1926 are 109,000 odd cwt. But it might interest the Committee to remember that the right hon. Gentleman the President of the Board of Trade has always warned the House of Commons not to accept these figures at their face value, because the year 1926 was an abnormal year.
The explanation, of course, is that, after 10 years of progressive decline in imports, and of a progressive decline in the severity of foreign competition, there was an increase of imports in 1926, because the importers of foreign manufactured goods knew that this duty was intended. The Committee had been set up and they knew the constitution of this Committee. They knew the scandalous composition of this Committee. They knew that, like nearly every other previous Committee, that Committee had been packed by the President of the Board of Trade, by two out-and-out pronounced. rabid, and violent Protectionists, and that, whatever the facts might have been, everybody knew what the recommendations of the Committee would be. Therefore, importers took advantage of the interval between that time and the coming into force of this duty, to rush into this country as many goods as possible. That is the explanation of the rise last year. If it had not been for the appointment of this Committee boy the President of the Board of Trade. it is perfectly certain from the evidence and from the experience that we have seen for the last
10 years, that the imports last year would have shown a further decline. Therefore, the case under that heading is not made out. There has been no abnormal increase of the imports of a competitive kind. On the contrary, there has been an annual decline. That is supported not only by figures but by the evidence of the only business man upon this Committee, a man who is fully acquainted with the industry, and who says in his report:
I am not satisfied, however, that translucent table-ware is being imported into this country in abnormal quantities.
"Although there may not have been an abnormal increase in the import of translucent china," the President of the Board of Trade says, "there has been an increase in the import of the competitive article which serve the same purpose." The right hon. Gentleman is wrong there, if he looks at his own figures. Take the table on page 9. There you have the heading, "Estimated net Imports of Chinaware included in Earthenware." In 1913 the figure was 311,583 cwts. In. 1922 that had fallen to 190,678. In 1925 it was 287,476. Last year included the large supplies of exceptional imports of chinaware. The table says, under the heading, "Net Imports of Chinaware," that in 1926 the net imports of chinaware were 109,370 cwts. The net imports of chinaware, including earthenware—

Sir P. CUNLIFFE-LISTER: The table says, "included in earthenware."

Mr. SNOWDEN: I do not understand the right hon. Gentleman's interruption.

Sir P. CUNLIFFE-LISTER: It is common ground, as everybody has known for a long time, that there have been a great many imports of what was really china, but the figures of which were included in the return as earthenware.

Mr. SNOWDEN: That is not material to my point at all. Figures are my case, and not any explanation of the President of the Board of Trade. Here are the figures—in 1913, 311,000 cwts., and in 1926, 255,000 cwts. Certainly those figures do not justify the claim that there has been an increase in imports in recent years, but, on the contrary, they show that there has been a
constant decline. Therefore, under that heading the case for this duty has not been proved.
Then the right hon. Gentleman went on to deal with wages. It is, of course, quite impossible to make accurate deductions if you take only the rates of wages in one country, and compare those rates with the rates of wages in another country. If you are going to get at the real facts you must take a great many other factors into consideration, such as the general standard of living in a country. There may be a country where what seems a low wage compared with the wage in this country really represents a high wage on account of the different standard of living, and there may be a country where an apparent high wage really represents a low wage, compared with the wage in this country. The Committee, on this point, do not appear to be very certain as to whether there is much difference in the wages as between this country and the countries which compete with us in this market, but they do state one very important and pertinent fact, and that is given on page 11, about the middle of this Report. We are dealing here really with the matter of the cost of production, and methods of manufacture are most important in this connection. Here is one of the most significant sentences in the Committee's Report. It is to be found about the middle of page 11, and it reads as follows:
They stated, by way of example, that in Czechoslovakia one skilled workman with thirteen assistants could turn out by means of automatic machinery 4,800 pieces per day as against about 360 in this country made by one man by ordinary hand methods.
There we have the fact—4,800 pieces a day compared with 360 in this country Made by one man. It is not a question of wages. You cannot possibly take away the competitive advantage of a country which has adopted that method of production.

Mr. HERBERT WILLIAMS: May I ask the right hon. Gentleman if he has done the arithmetic?

Mr. SNOWDEN: I leave it to the Tariff Reformers to do the arithmetic. There is a sentence somewhere else in the Committee's Report; it is to be
found in paragraph 35. It gives the wages in the china section of the industry, then the wages in Germany and I think in Czechoslovakia, but it does not say that the wages in Germany are wages for the same class of work as the wages given in the china section in this country. We may assume that the wages in the china section, which is the highest class of pottery industry, are higher than the general rate of wages in the pottery trade. The Committee, as I have said, have gone altogether outside their terms of reference. They were to consider the question of the imposition of an import duty on tableware of translucent pottery, but they did not confine their investigations to that nor did they confine their recommendations to that. Without warrant, and without application from this particular section of the trade, they went out of their way to recommend an import duty on a class of pottery which they were never asked to consider.
There is one other important matter in this Report. The President of the Board of Trade is very anxious, indeed, to conform strictly to the terms of the White Paper, and the White Paper says that there must be an application from the industry. What is the industry? According to the President of the Board of Trade the industry is the employing section of the industry. What was the main justification put forward by the Government for this procedure? It was the question of employment. These Safeguarding Duties were to be imposed in order to increase the volume of employment in the particular industry. That is a matter in which the operatives are deeply interested. But they were not a party to this inquiry or to the application for this duty. The right hon. Gentleman said that the relations between the employers and workmen in the pottery trade were very intimate, and if the state of the industry was such as to need a protective duty, and a high protective duty, why were not the operatives a party to this application? It is very significant that there is no reference in their Report to the fact that the operatives were not a party to the application.

Brigader-General Sir HENRY CROFT: They were not opposed to it.

Mr. SNOWDEN: They were not a party to it. If they had been anxious to see such a duty imposed in their interests, for an improvement of their wages, they certainly would have been a party to the application. Just a word on another matter which was dealt with by the right hon. Gentleman in his concluding remarks. He attempted to deal with the case against a specific duty put forward by the hon. Member for Orkney and Shetland (Sir R. Hamilton) and I do not think there was even an hon. Member opposite who considered that the President had made any reply to that case. I have had some figures supplied to me. The President says he has had some figures supplied to him. I believe the figures which have been supplied to me are quite as accurate as those which have been supplied to the right hon. Gentleman. They give the price of a consignment of cups and saucers. The President took the number of crates as the basis, and I will do the same. This was a shipment of 13 crates of cups and saucers, weighing 2 tons 7 cwts. 3 qrts., and the value was £87 10s. 6d. The duty charged upon that consignment was £66 17s. Hon. Members opposite are good at arithmetic and, as it is one of my weak points, I will leave it to them to work out the percentage of the duty in that case.

Lieut.-Colonel LAMBERT WARD: Can the right hon. Gentleman guarantee that the invoice was correct?

Mr. SNOWDEN: I am quite ready to accept these figures as being as correct as the figures given to the President of the Board of Trade, and which went unchallenged by the hon. and gallant Member. A duty of £66 17s. on a consignment of the value of £87 10s. 6d. is not a duty of 33⅓ per cent., but a duty of somewhere between 60 and 70 per cent,; and the applicants never asked for such a duty at all. Therefore, in two respects the Committee's recommendations have gone beyond what they were asked to do, and what the trade itself asked them to do They have given them an average protective duty nearly double the figure for which they asked, and they have also given a high protective duty which a large part of the industry neither asked nor expected. The President of the Board of Trade, without a single exception,
has accepted all the recommendations of this Committee, even when those recommendations were carried by a majority of only one vote.
I protest, as we protested at the time when the White Paper was before the House of Commons, against a question of national policy, which is a matter of acute division between political parties, being determined by one outside person. As a matter of fact, this question has been decided by Lady Askwith, and by nobody else. During thewhole of the Committee's deliberations she was obviously a biased and prejudiced party. This recommendation was carried by one vote only, and, therefore, if you set off the vote of the chairman against that of Mr. Hayhurst you have only Lady Askwith left. Therefore, this Report is the Report of Lady Askwith, and the House of Commons this afternoon is not being asked to approve proposals of the Board of Trade or of the Government but to say that in fiscal matters, in trade matters, it is under the dictatorship of Lady Askwith.

Sir H. CROFT: The speech of the right hon. Gentleman has been very interesting, but I must at the outset take exception to his remarks concerning a member of the Committee—Lady Ask-with. I have been associated with Lady Askwith for a good many years in connection with other questions, and I am quite safe in telling the right hon. Gentleman that Lady Askwith, who is a descendant of Sir Robert Peel and Lord John Russell, has been a Free Trader all her life, and until a few years ago she used to look very sadly at me when I advanced any of my fiscal arguments. For the right hon. Gentleman, without any knowledge, to say that this lady is biased is not quite fair, and I hope he will withdraw his insinuations.

Mr. HARRIS: Is she is Free Trader now?

Sir H. CROFT: She has sat on two or three Committees hearing evidence and she may not be a Free Trader now. That is very likely. The right hon. Gentleman says that all these questions are decided by one vote. May I remind him that there are only three members on the Committee, and that after all it is not Lady Askwith who decides these questions but Parliament, although the
Liberal party, judging from the state of the Liberal Benches, does not seem to take much interest in this matter.

Mr. ERNEST BROWN: Look behind you!

Sir H. CROFT: But I have always regarded this as the one remaining rag left to the Liberal party, and I am surprised that they show such little interest in it. I think it is only fair to consider the opinions of the third member of the Committee. It shows the impartiality of the President of the Board of Trade. This gentleman—Mr. Hayhurst—represents the co-operative movement and is not a business man in the sense of being a producer. He is a commercial agent for the co-operative institution.

Mr. SNOWDEN: Mr. Hayhurst is a director of one of the largest distributing organisations in this country, an organisation which, I believe, is responsible for a trade between £150,000,000 and £200,000,000 a year. He is also a director of a pottery, and a very successful pottery.

Sir H. CROFT: I am sure the right hon. Gentleman is quite accurate in saying that Mr. Hayhurst is a director of one of the largest distributing businesses in this country, and I am interested to hear that he is a director of a pottery. I can only regret that he only went to see one pottery, a co-operative pottery, and that he did not visit others. The right hon. Gentleman in making his case endeavoured to prove that there was no considerable increase in the imports of pottery into this country, and he said that the large increase of last year was only due to the fact that people abroad were getting nervous as to the possibility of an import duty being imposed and therefore increased their imports. Does he apply that same argument to British production? It has steadily fallen in the last 15 years, and it is inconceivable you can consider the case without putting the two facts together. May I be allowed to give the right hon. Gentleman the total value of the imports in those industries in 1924 in 1925 and in 1926. In 1924 the round figures were £8,500,000. In 1925 they had risen to £9,840,000 and in 1926 to £11,297,000. The right hon. Gentleman's greatest desire, I am sure, is to see our people employed. Does he not
think that these increases are staggering, when we take account of the fact that our home production at the same time has decreased as is shown in the table in the White Paper?
The right hon. Gentleman tried to make a point in regard to wages, and he said that we must consider other matters as well. He went into a calculation which, I think, showed conclusively that the British worker is more efficient than his foreign competitors. There is, therefore, all the more reason that, with such efficiency, we should not permit him to be undersold by those who are working at a wage level like that referred to in the White Paper. The hon. Member for West Leicester (Mr. PethickLawrence) made a very interesting speech, but I hope he realises that his own constituents at the present time are very anxious. In the industry with which his constituency is principally concerned there is a demand from employers and employed. Both, I think, are approaching him with a view to some help being given in the matter of hosiery. When he told us that the working classes pay the whole duty on these imported goods, I think he was wrong. I have never been one of those who contend that any kind of protection is going to reduce the price of tie article. I do not think that follows, though I also think that it is possible, with the greater security of the duty and a reduction of overhead charges by mass production, to produce an article which is cheaper. That has happened in some industries which have been protected under the McKenna Duties or the Safeguarding of Industries Act. But when the hon. Gentleman deliberately says that the working classes will pay the whole duty, he is going contrary to the experience which we have had in connection with every single duty imposed in this country.
It is a pity that fears such as this should be raised, because they have been proved false in every other case. The hon. Member might have been justified in saying that part of this duty may ultimately be borne by the consumer, but he was stretching his advocacy a little when he suggested that the whole of the duty would be paid in that way. In practically every case of articles protected
by the present Government under these Measures, the price has not been increased to the working classes. The hon. Member then went on to say that this duty was going to be bad for the trade. I think he will admit that if it were bad for the trade those who are principally involved financially in the industry would not have asked for this security.

Mr. PETHICK-LAWRENCE: What I said was that it is going to be bad for the earthenware trade and that the members of that trade were not parties to this application.

Sir H. CROFT: I am rather at a loss to see how it can be bad for the earthenware trade unless the protected trade is so successful that, in fact, the duty will do what the hon. Gentleman has told us it will not do, namely, reduce the price so as to compete with earthenware. The curious thing is that the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) spoke on behalf of the workers just now. I am surprised that the hon. Member for Hanley (Mr. Clowes) or some of the other Socialist representatives from the pottery districts are not here to say that the workers in the industry are opposed to the duty. That would carry more conviction. All I can say is that the fact that an hon. Member opposite sought to count out the Committee seems to show there is not any very considerable interest against these proposals on the benches opposite, and perhaps that explains why so many members of the party opposite have gone down to the country to play bowls this afternoon. The hon. Member for West Leicester also referred to the wages question, and I think on that point he must find himself in conflict with the majority of his party. He will not deny that the differences in wage values between the pottery industry in this country and Czechoslovakia or Germany are considerable. I think I am right in saying that our lowest wages are higher than the highest in Czechoslovakia.
If that be anything tike the case, have we not arrived at the situation contemplated by the official Opposition when they laid down the policy—which has never been repudiated—that if goods were being imported into this country
produced on lower wages or longer hours than those prevailing in this country, then they were in favour not merely of a tariff but of prohibition? How is it that the hon. Member goes counter to this view, endorsed, as it was, by over 1,000,000 on a card vote at the Trade Union Conference this year? He deliberately says that British workers ought to be subjected to the competition of a wage level which, if imposed in this country, would be regarded as sweating by every hon. Member opposite. There was an interesting Debate two days ago on the question of matches, and an hon. Gentleman who speaks for the co-operative movement in this House boasted that the co-operative movement were buying thousands of gross of matches from Finland. It surprised many of us that he should have been so bold, and his answer to us was that, while they bought these matches from Finland, they were selling, in return, a large number of bicycles and boots and shoes and other articles to the people of Finland.
I presume the right hon. Gentleman the Member for Colne Valley would use the same argument in regard to pottery. We on this side say that not only has a case been made out for the pottery trade in this matter, but that the argument to which I have just referred can no longer hold water in these Debates, for this reason. A large number of people in the pottery trade have been out of work for a considerable time. If you give them employment they will be able to buy the bicycles and the boots and shoes which you may now be selling in exchange for imported pottery. That argument has not been realised by the party opposite. As long as we have 1,000,000 unemployed in this country, are we not wise to do everything in our power to see that our own people are employed, especially when we know that they are only on the streets because they are competing with something which is as near to being a sweated product as anything which the party opposite ever denounced in the past? I hope there will be no doubt about this duty. I hope hon. Members opposite will not go to a Division. I believe that deep down in their hearts they see that the policy which considers only the merchant is a selfish policy and that our bounden duty,
if we are to regain our national prosperity, is to see after our national production.

Mr. RILEY: I desire to emphasise the objection to this duty, first, on the ground put forward by the right hon. Gentleman the Member for Colne Valley (Mr. Snowden), namely, that the Committee is now being invited to embark upon a development of national policy, on the strength of a report, in circumstances which are perfectly scandalous. I should like to ask the President of the Board of Trade whether there was any meeting of the committee of inquiry to consider their report after the closing of the evidence, and, if so, how many persons were present at that meeting. We now know as a matter of public information that the committee, consisting of three persons, closed the taking of evidence on 15th February, and that one member of the committee, within a few hours, left this country for South America. The evidence was closed on 15th February and the report was signed on 23rd March. Only five weeks or thereabouts elapsed between the closing of the evidence on which the report had to be made to the Ministry, and the signing of the report. The member who, within a few hours of the closing of the evidence, went to South America, presumably could not possibly return in time to take part in the meeting, to assist in coming to a judicial decision and to sign the report.

Sir P. CUNLIFFE-LISTER: I have never interfered with the conduct of the proceedings of the committee in the least or inquired as to when it was sitting. That was an undertaking which I gave to the House, and I have strictly kept it. I have not the least idea of how many meetings the committee may have held, but I have known many instances where a Judge, after hearing evidence, has immediately proceeded to give judgment.

Mr. RILEY: This is not the case of a Judge dealing with evidence but the case of three members of a committee appointed to hold an inquiry. Their duty was—after all the evidence had been submitted—to weigh up that evidence. A Judge may make up his mind in the course of the evidence and then decide, but their duty was, the evidence having been given, to weigh it up and in the
light of all that evidence to come to a decision, agreed or otherwise. As the right hon. Gentleman the Member for Colne Valley has said, this policy is being based on the decision of one person. There were only three persons in all, one of whom, after the collection of the evidence, left the country. The report had to be issued by the other two who presumably met together to consider it. We now know that of those two, one was entirely opposed to the recommendations. He issued a minority report and in several paragraphs he says that in his opinion the evidence submitted did not justify the applicants in seeking the order. We are told by the President of the Board of Trade that the Committee found that the main ground on which safeguarding should be granted was the abnormal increase in imports during recent years. What are the facts of the case? The President called attention to page 9 of the Report, where a table of imports of pottery is given, and he stressed the point that for the years 1909 to 1913 the average weight of imports was 300,342 cwts., and in 1926 it was 365,000 cwts. On the face of it, that is a very considerable rise. But let us take not simply one year, 1926, but take the years 1913 to 1926, or take the average of the years 1922, 1923, 1924, 1925 and 1926. What we find then is that the average for these last years is only 224,000 cwts. per annum.

Mr. H. WILLIAMS: If you are very ill, does the doctor judge of your temperature by the average of the last week, or at the time when he is examining you?

Mr. RILEY: The hon. Member can put that argument in the course of his speech. I was calling the attention of the Committee to this table which shows that from 1909 to 1913 the average imports were 300,342 cwts. In the year 1913 it was 341,000 cwts. If we take the average for the period from 1920 down to 1926 we find the average is 224,000, which is less than the average in the period for 1909 to 1913. Therefore, as Mr. Hayhurst, a member of the Committee said, the 1925 imports were less than those in 1913. On those figures I submit that the claim that a substantial duty is justified by an enormous increase in imports is
not supported by the facts of the case. But I have an objection to this duty apart from the grounds upon which this recommendation is made, which I regard as inadequate grounds and grounds which have been arrived at in a manner not very creditable to the present Ministry in its conduct of these inquiries. I object to it on account of its niggling and petty character. In his Budget speech the Chancellor of the Exchequer told us that he expected to get out of this duty on pottery £150,000 in the present year and, possibly, £200,000 in a full year subsequently. To disturb this trade and the price of these articles of everyday household use for a paltry £150,000 a year is not a sound policy, and is an unworthy method of trying to raise revenue when there are millions of pounds to be found elsewhere which could be tapped without those who would be liable to pay feeling the burden in the least.
As in so many other cases, this duty is being applied in such a way that it will fall on the backs of chose least able to bear it. It has not been disputed that the duty will be lowest on the most expensive pottery and glassware and highest on the cheapest kinds of pottery. Take as an example what are called half thick tea-sets, in cases of 35 dozens. Here is an actual instance of a consignment weighing 2 cwt. 3 qrs. 12 lbs., invoiced at £4 2s. 8d. without the duty. The duty on that amounts to £4 0s..4d.; that is a duty of 97½ per cent. on common cottage ware tea-sets. That means that a single article which on import is priced, say, 1s. without the duty, is raised in price practically to 2s. by the incidence of the duty. The users of that pottery have not only to pay the actual sum by which the duty increases the price of the article, but an extra sum in respect of the several profits which are made on the goods between the time they leave the importer and reach the retail buyer. Let us assume that there is a profit of 50 per cent. made betwen the importer and the retailer. The purchasers of this class of pottery, who are the poorest people, have to pay not only the duty of 100 per cent., but an additional 50 per cent. representing these profits. Not only is the duty passed on to the consumer, but he has to pay for the increased capital expenditure on the part of the traders who are
handling these goods. From every point of view the incidence of this tax will be unjust.

Mr. REMER: Two points have emerged from this Debate which I think call for some protest, not merely from the party point of view but from the point of view of the whole House of Commons. I refer first to the criticisms upon the in partiality of the various committees, and in particular of this committee, which has given this decision as to a duty on pottery. If every committee appointed by my right hon. Friend the President of the Board of Trade is to be subjected to this kind of attack in the House of Commons, it will be impossible for him to secure men to serve upon these committees. It would be just as unreasonable for me to criticise my right hon. Friend about the far larger number of committees which have given decisions against the imposition of a duty, and condemn him for having appointed convinced Free Traders to serve on those committees. The second point which has emerged from the Debate is the statement by the right hon. Member for Colne Valley (Mr. Snowden) that there was no demand for this duty from the industry itself. While this committee was sitting the hon. Member for Hanley (Mr. Clowes) made a reference in the "Staffordshire Sentinel" to a, speech I had delivered in my own constituency. In that letter, which was extensively quoted in the proceedings of the committee, he made it quite clear that they of the society representing pottery workers were not either for or against a duty, but were entirely neutral in this matter. To say, therefore, that they are not parties to the duty does not mean that they are against it.
It is noteworthw, as my hon. and gallant Friend the Member for Bournemouth (Sir H. Croft) has already pointed out, that not a single Member for the Potteries is present this evening while this duty is under discussion. There are four Members representing the Potteries, three of them Labour Members. One of them, the hon. Member for Stoke-on- Trent (Lieut.-Colonel John Ward) is, I believe—so he has told me—in favour of the duty. We all regret the reason for his absence. I think the whole Committee know that he is only absent on account of ill-health. It would be interesting
to know why the Pottery Members, if they are so violently opposed to this duty, are not in their places to state their reasons in Debate. Some rather curious arguments have been put forward in the previous Debates on this duty. During the consideration of the Budget Resolution, the right hon. Member for Spen Valley (Sir J. Simon) condemned this duty at great length, calling it a cruel tax upon the working people of this country. His argument was based on the statement that the price of pottery would be increased to the very poorest in the land. I have been in consultation with a very large number of people in the pottery industry, as was my duty, seeing that I represent a constituency adjacent to that great industrial area, and they tell me that in the circumstances prevailing at the moment no manufacturer would raise his prices one penny above what he was charging before this duty was imposed.

Mr. RILEY: Will the hon. Member say who he expects will pay the duty?

6.0. p. m.

Mr. REMER: I was coming to that in a moment. I can give the hon. Member a quite conclusive answer to his question. What were the conditions of the pottery industry prior to the imposition of this duty? The industry was working only three or four days a week. If a manufacturer can work full time the proportion of his standing charges, rent, rates and taxes, which are imposed whether he is working full time or short time, is reduced to such an extent that he can sell his goods at a lower price and make a profit, whereas when he was working short time he was making a loss even at the higher price. The right hon. Gentleman the Member for Spen Valley on the Budget Resolution, stated that he had studied the shorthand notes of the inquiry dealing with this matter, and, therefore, he must know that it was stated quite clearly at the inquiry what a terrible amount of unemployment there was in the Potteries before this duty was imposed. It amounted to as much as 16 per cent., and, if the right hon. Gentleman has, as we know he has, sympathy for those people who are suffering, surely he should have sympathy for these people, one in five of whom are out of work totally—not temporarily—while the remainder are only working
three or four days a week. The sum total of the arguments of the right hon. Gentleman and of hon. Gentlemen opposite is to condemn these pottery workers permanently to their present condition—16 per cent. totally unemployed, and the balance working short time; and I would submit that it is poor comfort to these people, who have no money in their pockets, for the right hon. Gentleman or hon. Gentlemen opposite to tell them that, if they oppose this duty, they will have cheap pottery.
England has been the natural home of the pottery industry. China clay—ball clay and china stone—is produced to the greatest extent in the world in the counties of Devon and Cornwall, and we export these commodities, not only to Germany, but to America, Spain, Portugal, and, indeed, practically all over the world. It may be asked why the pottery industry is stationed in Staffordshire, such a long way from where these commodities, which are so necessary for the production of china, are found. There is a very good reason, namely, that Staffordshire coal is the most suitable for making pottery, so that Staffordshire is the natural home of the most efficient production of pottery. In that area there are people who have been in the business for generations. The industry is unique in the world, and the manufacturers and workpeople in Staffordshire are admitted by everyone to be the most skilled potters in the world. It may be asked why, if this be correct, they are beaten in their own market. The answer is quite a simple one. It is that in Germany the wages are 33⅓ per cent. lower than in this country, and in Czechoslovakia they are 50 per cent. lower. Here was this industry, one of the finest skilled industries in this country, slowly bleeding to death, and the people who are supposed to protect Labour in this country come here and condemn the one means by which the industry can be restored.
I want to refer to the speech of the hon. Member for Keighley (Mr. Lees-Smith) on the Budget Resolution. He told us that the remedy for the pottery industry was that the English manufacturers should start to manufacture felspar china. I do not know where he got his information from, or what was the basis
of his knowledge of this industry, but it is rather surprising, if that be the remedy, that no Continental manufacturer of felspar china has attempted to manufacture it in this country before. There would be a great saving in carriage, there would be a closer liaison between the manufacturer and his customer, there would be many advantages for him if he came here and set up his works. If the hon. Member's arguments were right, one would suppose that Continental manufacturers would have done that. The reason why they have not done it is that the cost of labour in this country is twice what it is in Czechoslovakia, and the cost of erecting works here is twice what it is in that country. It will be very interesting to see if the Czechoslovakian manufacturers will now erect potteries here as a result of the duty.
A further argument used by the hon. Member, when he was speaking on the Budget Resolution, was that the earthenware manufacturers had not applied for a duty upon earthenware. There was a very good reason why the earthenware manufacturers, in November of last year, did not make an application, namely, that at that time no earthenware of any kind was being imported into this country; but in November of last year, for the first time in 45 years, earthenware was offered for sale in this country, and I am informed that it is now being freely offered in this country by Continental manufacturers. Possibly, therefore, the earthenware manufacturers may look at this subject at the present time in a rather different light. I am quite satisfied that this duty is going to provide full employment and better wages for the workers in this industry. and I cannot understand the attitude of the Socialist party in condemning the one means of raising the standard of life of those workers—of raising their wages and bettering their conditions. I hope that in all the pottery districts it will be shown conclusively to the working people there that the party which represents them in the House of Commons has done everything it could to grind down those workers to a state of unemployment.

Mr. HARRIS: From this discussion very few people would think we were dealing with the Finance Bill, that is to say, a Bill to provide the necessary revenue for carrying on the country and raising
taxation, because the question of taxation has been peculiarly absent from the discussion. This Bill is a Bill to impose taxes and raise revenue, but, under the new regime, our Finance Bill has been diverted from what has been its object for many years, and the discussions upon it are degenerating into a controversy in favour of Protection. Speeches have been made by hon. Members opposite—and I make no complaint of it—which would apply with equal reason to any manufactured article imported from abroad, or to bacon, bread, meat, butter, and every other import of any article produced in this country. I cannot help thinking that it is rather hard on the farmers, who used to look upon the Tories as their friends. They have been badly deserted. They have to pay more for everything they buy—cups, saucers, cutlery, and so on. The only purpose of this tax is to raise prices. The ground of this particular proposal is that manufacturers in the Potteries find that they cannot produce china as cheaply as manufacturers in Germany and Czechoslovakia, and they say, as was said by the hon. Member for Macclesfield (Mr. Remer), that that is because of the labour costs. Whatever may be the cause, the contention is that they cannot sell at the present price because it means selling at a loss, and the admitted purpose of this duty is to remove foreign competition, so that the consumer, who, after all, is a more important person than the trader and the merchant— the trader and the merchant are of very small account; it is the user, the person who has to buy the articles, the house wife, the working-class family, the person who has to spend the money—will have to pay more for these items.

Sir H. CROFT: Can the hon. Member say where they have to pay more—in what particular industry?

Mr. HARRIS: They pay more in the shops when they buy across the counter. As an instance, I may mention that my hon. Friend the Member for North Lam-beth (Mr. Briant) has been organising a camp, and he wanted to buy some mugs. He searched all London in his endeavour to buy drinking mugs for his camp. I do not suppose that the hon. and gallant Gentleman ever used anything so vulgar as a drinking mug. Probably my hon. Friend will be abused at every street
corner by our Tariff Reform friends, but he wanted to buy these cheap china mugs. They are not obtainable any more. The tariff is having its effect. The market is there, but my hon. Friend has had to get a substitute. Now you cannot buy an English substitute—it is not available; and my hon. Friend has to buy cheap enamelled iron mugs imported from abroad. Perhaps the hon. and gallant Gentleman will say that a cheap mug of that kind is quite good enough for working-class children, but it is not so pleasant to use for a cup of tea., and, of course, it is a poor substitute for the china mug. That is a good example of what is going on all over the country as a result of this tax.

Mr. GREENE: Can the hon. Member say why gloves have gone down in price since they have been protected?

Mr. HARRIS: We are discussing mugs at the moment, not gloves.

Mr. GREENE: The hon. Gentleman knows more about mugs than I do.

Mr. BUCHANAN: You can always tell them when you see them.

Mr. HARRIS: I hope the Debate will not be allowed to degenerate into personal abuse.

Mr. GREENE: I was not referring to the hon. Member when I referred to mugs.

Mr. HARRIS: As a matter of fact, the cheap gloves of the ordinary working woman are more expensive and are far more difficult to get. I agree as regards the kid gloves of Bond Street. They were already very expensive, and it means that the rich woman can still buy them, but the working-class woman in the East End of London cannot buy expensive Westbury or Yeovil gloves in Bond Street; she has to put up with cheap cotton gloves.

The CHAIRMAN: I think I heard the hon. Member say he was discussing pottery.

Mr. HARRIS: So I was, but I was interrupted by the hon. Gentleman opposite, and I thought that perhaps you might have protected me, so that I might concentrate on my subject.

The CHAIRMAN: The hon. Member so effectively corrected the hon. Member for Worcester (Mr. Greene) that I thought it unnecessary that I should do so.

Mr. HARRIS: The real reason why there is depression in the china industry, where there is undoubtedly short time and unemployment, is the high prices at which the articles are offered. The prices of china have gone up to three times the pre-War prices, and that has meant that at present prices these articles are quite out of reach of the ordinary user of crockery and china-ware. The result has been that, although there is depression in the manufacture of china, immense strides have been made in the substitute manufacture of earthenware, because earthenware has gone up only 75 per cent. as opposed to treble the price in the case of china. The very same amount of labour has been employed in the production of the earthenware as of the china. They are under very much the same trade unions, and have the same rates. The earthenware manufacturer having adapted himself to new methods and to the requirements of the market, and the public having the money to spend on china, they have been able to extend their plant, increase their production, improve their design, and meet the demands of the public. As far as one can see, the price is so enormously different from the foreign article, produced by better methods, with different materials, and by an entirely different process, that the English bone china cannot be called a really serious competitor with the felspar china produced under mass production and by new methods. You might as well compare the production of a Rolls-Royce car with a Ford as compare the manufacture of high quality china in Staffordshire, made under old-fashioned methods, and bone china with felspar china manufactured abroad under new methods and mass production with all that that involves.
When you come to the labour costs, it is doubtful whether you can really say there is justification under the machinery of the Safeguarding of Industries for imposing this duty. I find the labour cost of an equivalent tea set in earthenware works out at 1s. 8d., with the same trade union rates and conditions, as compared with 5s. 11d. for bone china; felspar
china, which is very little different from earthenware, works out at 1s. 5d., a little less, but the fact remains that under the duties now proposed the real assistance will be given to the manufacturer of earthenware, who did not ask for a duty, who had no inquiry made into his case, who has never been asked to put forward evidence, and has not been subject to cross-examination. They will be freed from competition and will be able to get the advantage of a protected market. It is a curious fact, which has to be borne in mind, that many of the people who control the manufacture of china are also controlling the production of earthenware. Perhaps they knew the weakness of their case in asking for protection for earthenware and preferred to keep in the background and allow their case to be fought by the organisation representing the production of translucent china.
One thing we might ask is that the President of the Board of Trade might very well consider the exclusion of vitrified pottery. I understand already in many cases the Customs officials are not including many articles which would not come under the description of vitrified ware, because when you start going into a Customs tariff, it is very difficult to distinguish between this article and that. The right hon. Gentleman admitted that in his speech. He is very proud of the difficulty to the ordinary person of distinguishing between translucent ware and ordinary earthenware. It is only the initiated who can easily distinguish. The Customs House officials are already very worried and troubled to decide under which particular category the import comes. On the whole I understand many articles have already been excluded by taxation which are generally described as vitrified pottery, and I think it would be reasonable, when we come to the detailed Amendments, that this particular article should be excepted.
May I refer to the method of levying the duty. This plan of levying duty by weight is novel. Some of the interested parties thought it would be more convenient and would lead to less disturbance in the trade not to unpack the cases and value each article separately but to lump them together and charge the duty on the weight. In order to save trouble, the Committee came to the conclusion that that was the simplest plan. No inquiry
was held and witnesses were not cross-examined. We do not know on whose advice it was, but the Commissioners came to the conclusion that 25s. a cwt. was a reasonable interpretation of the request for a 33⅓ per cent. duty. Since then the various trade interests have had time to inquire. They had gone to great trouble and given the right hon. Gentleman many examples. I believe most of the figures have been placed before his officials. I know he is a very busy man, and spends a good deal of his time upstairs, trying to get protection for films and various other matters. No doubt he did not have time to consider all the evidence before him, but it is a very peculiar thing that he has brought down to the Committee one example that is favourable to his case that this duty is a fair one. He took goods imported from Czechoslovakia, which are of a finer character and decorated, and, therefore, their value is higher compared with their weight. He ignored the tact that, generally speaking, the familiar china tea-set, the modern article used in every working-class home, is heavy, coarse, and not decorated, and its principal qualification is its cheapness. There is evidence to show that in most of these cheap tea-sets, which make up the bulk of the imports, the duty works out not at 33⅓ per cent. but at 70 per cent., 80 per cent., 90 per cent. and 100 per cent.
If the right hon. Gentleman desires to be just and fair, not to the foreign manufacturer but to the general public, especially the working class, he should be prepared to listen to representations to bring the proposed duty more into line with the rate asked for by the applicants and on which evidence was given at the inquiry. I have here examples extending over three or four months. Here is a case of 5,537 cwt., which at 28s. works out at £7,753, on goods invoiced at £11,108. I shall be pleased to hand the figures over. They have been placed before the Board of Trade and an unanswerable case has been made out for lowering the rate of duty, it you are not going to take advantage of this occasion to put something like a penal tax on an article of general use by the working class, who are already overburdened and suffering from high prices in many articles of general use, and I think the Minister ought to be prepared
to consider it when we reach the Amendment in my name. The people of London have a specially strong case against this duty. There are 7,000,000 people living on open ports. Here is the Government, under the excuse of safeguarding machinery, giving protection to this industry in one part of this country and another industry in another, seriously interfering with the trade of London, whose very existence depends on open ports. This duty is going to divert trade from London to the mainland, and throw out a large number of workers employed as workers, carmen, packers, and, not least, seamen. For that reason only, as a London Member would not hesitate to vote against this duty. It is against the weight of evidence. It singles out one trade for special favour, and is going to make an article of general use to the public very much more expensive.

Mr. H. WILLIAMS: I have listened with interest to the hon. Member's speech. He made a number of assertions which he did not support with any particular evidence. In conclusion he asked us to consider the situation of London, one of the constituencies of which he represents. London has a far lower level of unemployment than any other great industrial centre, perhaps only a third of that which prevails in North Staffordshire. The hon. Member should not be quite so narrow and selfish as he appears to be.

Mr. HARRIS: There are 7,000,000 people in London.

Mr. WILLIAMS: I quite agree that there are 7,000,000 people in London, but I am talking about percentages. The ratio of unemployment is about a third of that prevailing in North Stafford-shire. I should imagine a man with his noble principles would have some consideration for other people. Then he says it is a novel thing that there should be a duty by weight. For many years he supported a Liberal Government that taxed tea and sugar by weight. There is nothing novel in duties by weight. He has only to examine any tariff in any country and he will find large numbers of specific duties, and in pre-War days, when he used to make speeches in opposition to Protection, I am certain he used to turn out the same kind of, shall we say
stuff, that those who hold his views turn out, and say you could not possibly have ad valorem duties. It was so difficult to determine. It was always urged that these duties must be specific, and that was one of the attacks made on Mr. Chamberlain, because he rather tended to advocate ad valorem duties. So when we present them with what they want, they do not like it.
Then the hon. Member attacked the efficiency of British producers, but he gave no evidence. I suppose he wanted to support what the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) had said, when he drew our attention to page 11. He said, "Here we have 4,800 pieces a day turned out in Czechoslovakia, against 360 in this country made by one man by ordinary methods." But in Czechoslovakia there was one skilled workman with 13 assistants doing the job. The right hon. Gentleman declined to do the little sum in arithmetic, and left it to the Tariff Reformers. He did not want to do it, because it would expose the folly of his argument. The average per person in Czechoslovakia was 343, and the primitive, incompetent, unscientific Englishman, whom he is so happy in denouncing, does 360 in a day.

Mr. RILEY: It is one skilled person with 13 assistants.

Mr. WILLIAMS: I have always heard the hon. Member stand up for the bottom dog, the unskilled labourer. He has to live, and he lives out of his production. The single man, with 13 assistants, does less than one man in this country. I want to raise the standard of living of the people. I can only raise the standard of living by raising the efficiency of their production. If a man turns out 343 instead of 360, that would be his standard of living. The hon. Member for Dewsbury (Mr. Riley), who has just interrupted me, has asked us to consider, not the imports during 1926, but to take the average of the last five or six years. If you take the average of the last five or six years, he said, the imports are not abnormal. But they did not make the application until the imports became abnormal. They are asking us to deal with the existing situation. It would be no satisfaction to the people in his constituency
who are out of work now if you pointed out to them the average imports relating to some time past when they were in work. What they want is a job now, and we are trying to get them a job now by imposing this duty.
We have had some depressing examples of how a specific duty may result in a very high ad valorem rate. Taking the whole of the pottery imported this year, roughly 95,000 cwts. valued at just over £313,000, or an average of 66s. a cwt., a duty of 28s, does work out to rather less than the figure mentioned, but only to 42 per cent. It is no use coming along with some isolated cases and attempting to prove your case with an example which has been supplied no doubt by some foreign importer who is rather distressed because he is going to lose his trade, which will pass to the British producer. Mr. Hayhurst, who did not agree with the duty, pointed out that there was one pottery where they were making reasonable profits, though even in that case the organisation of the factory was not all that, could be desired. I am told that the particular factory was a co-operative factory. I am fold that it is the most inefficient factory in the district and yet it made reasonable profits. [An HON. MEMBER: "Why put on the duty then?"] It made reasonable profits for this reason. I imagine that it has a guaranteed market, the guaranteed market being its own proprietors. In order to maintain its success, no doubt, they bought the products at appropriate prices which produced a profit. That is not very conclusive evidence of the state of the industry.
Will this duty give more employment to my own fellow countrypeople? I think it will. I think an analogy of the existing duties shows conclusively that it will. You may take the analogy of a trade, one section of which is safeguarded, and the other section of which is not—the hosiery trade. The greater part of hosiery is made of wool or cotton, but there is a very large amount of hosiery made of silk or artificial silk. What has happened since the hosiery which is made of silk or artificial silk has been protected? The importation of this kind of hosiery has rapidly diminished, while the importation of hosiery made of cotton or wool has rapidly increased. When we come to exportation, the exportation of artificial silk and silk hosiery has increased,
while the exportation of woollen and cotton hosiery has diminished, proving conclusively that you have raised the efficiency of that branch of the hosiery industry.

Mr. HARRIS: Not at all. You are using silk hosiery instead of woollen and cotton hosiery.

Mr. WILLIAMS: Surely, any Member of Parliament who, as part of his duties, attends a great many social functions in his constituency of the jazz variety, must have observed that the introduction of artificial silk on the nether limbs of the opposite sex took place long before the Silk Duties were imposed.

The CHAIRMAN: We are not considering the Silk Duties but the Pottery Duties.

Mr. WILLIAMS: I apologise. I did not wish to go beyond the analogy, but the interruption led me rather further than I intended to go. With regard to the question of prices, why should it be alleged that this burden is going to be cast upon the poor? Is there any justification, as far as we have experimented in this matter, for saying that the burden has been cast upon the poor? Broadly speaking, can any hon. Member opposite point to any new duty which has, in fact, made any serious addition to the price of any commodity? [An HON. MEMBER: "Gas mantles!"] I hope I am not going to be stopped again, for I am only going to draw attention to an answer to a question in the House of Commons two days ago as regards gas mantles.

Mr. HARRIS: I stick to my facts.

Mr. WILLIAMS: Precisely, and the statement is true but entirely misleading. An hon. Member drew attention to one type of gas mantle sold at a certain price and another gas mantle which is a very much superior article and is sold at a higher price. He was merely misleading, because he read it in the newspapers like the rest of us, and did not investigate the matter. If he will take the official information based upon the inquiries as to the price at which they were sold last year, he will find that the wholesale price went up by a shilling a gross and that the retail price, broadly
speaking, was not affected. I take the analogy of the one selected by the hon. Gentleman.

Mr. HARRIS: It is not true.

Mr. WILLIAMS: It is true. Go into the shops and compare quality with quality. Eighty-five per cent. of the gas mantles sold in this country last year were sold at an average price of only one shilling a gross higher than the average price which prevailed previously. That is the analogy. I do not care what commodity you may take—there may be odd exceptions—the price has not risen. As the result of increased efficiency in a guaranteed market, prices have fallen. It is no use getting up and constantly asserting, as you have done for the past three generations, that the sole effect of a duty is to raise prices, when you have innumerable cases destroying the theoretical basis of your argument. We do not want generalisations based on the past, but concrete examples based on our present experiences.

Mr. BARNES: Listening to these Debates on the Safeguarding of Industries, it appears to me that the only time that the Conservative party, or the Members of this party, and particularly the Member for Macclesfield (Mr. Remer) and the Member for Bournemouth (Sir H. Croft), have a good word to say for the British working man is in a Tariff Reform Debate, when he becomes the most skilled workman in the world, and during a war, when he becomes the most patriotic worker in the world. But when the British working man is actually unemployed, whether it is of because of Free Trade or the absence of Tariff Reform, we do not find that sympathy and appreciation as to the value of the British working man displayed in the the policy of the party of the hon. Members opposite.

Sir H. CROFT: May I ask the hon. Gentleman if he has ever heard me make any speech or remark decrying the British working classes, who are so unfortunately led in this Debate?

Mr. REMER: Has the hon. Gentleman ever heard a speech from me decrying the British working man?

Mr. BARNES: I can quote something which is more effective than speeches—the votes of the hon. Members on occasion after occasion.

The CHAIRMAN: I think that the hon. Member for Reading (Mr. H. Williams) was going rather wide of the subject, but the hon. Gentleman is going a great deal beyond the scope of the Resolution for vitrified pottery.

Mr. BARNES: During the Debate the skill and the emotions of the workers have been referred to with regard to the state of unemployment in particular industries, and the hon. Member for Macclesfield in particular, addressed the Members on this side of the Committee as if we have no sympathy for the unemployed working man. As a matter of fact we have the utmost sympathy for any unemployed worker, because the majority of us on this side of the Committee at some time or other during our working career have experienced the difficulties of unemployment. Therefore, we do not wish to be reminded by persons, who, possibly, have never known the difficulty of getting a job in order to obtain a meal, of the reaction of Free Trade and Tariff Reform on the people of this country. As a matter of fact, I do not stand here as a fanatical Free Trader. I do not consider that the principle of Free Trade by itself can solve the difficulties and the problems of unemployment in this country, but I seriously state and with equal emphasis, that I do not consider the principle of safeguarding or of Tariff Reform will provide any additional employment for the workers of this country, or in any way case the difficulties they have to meet. I do so because of this fact. I entirely agree that you can take a specific industry or trade and by artificial stimulus increase, possibly, the amount of employment in that trade. We have seen it in regard to the sugar-beet industry. We have seen it in other industries.
If you are prepared to administer artificial aid to an industry, of course you can produce favourable conditions. The principles on which the Safeguarding proposals are being introduced in this country are vicious and bad in practice, and must inevitably lead to corruption of political administration through the avenues of trade. It does not matter whether the President of the Board of Trade is a fanatical Tariff Reformer or not, he can always appoint committees of three who will give him the decision he wants. Does any hon.
Member opposite wish to assert that if the right hon. Gentleman the Member for Colne Valley had the responsibility of appointing committees of three he could not appoint committees that would give him a majority decision in favour of Free Trade. Any Member of this House knows very well that the system of appointing three persons to decide a question of fiscal policy in its relation to any particular trade or industry in this country is fundamentally wrong and that it must lay itself open to the charge of corruption for the purposes of serving vested interests.

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Sir Burton Chadwick): Is the hon. Gentleman aware that on the committees appointed by my right hon. Friend the President of the Board of Trade 50 per cent. of them have recommended against a duty?

Mr. BARNES: I am not at all surprised at that, because, as a matter of fact, in this country the bulk of our trade is based upon such a principle that it is impossible, in view of the fact that the working costs depend upon the importation of raw materials and things of that sort, to get applications through, even if you packed the committees entirely with, tariff reformers. But it is a significant thing that it is the secondary trades that are beginning to get through under the principle of the Safeguarding of Industries Act. However much you may play with figures, you cannot avoid the fact that eventually the additional artificial costs of these industries are bound to find their way ultimately to the purchaser. I said once before in these discussions that the Conservative party and the people of this country must make up their minds what they are going to do, either we are going to sacrifice entirely the primary industries of this country upon which we built our wealth and upon which the secondary industries in the long run depend for their trade—I am speaking of coal, cotton, shipbuilding, engineering, iron and steel—

The CHAIRMAN: This is most suitable for a Second Reading Debate. If the hon. Member continues in this way there may be no end to the matter.

Mr. BARNES: I was led into that general statement by the Parliamentary Secretary to the Board of Trade, who
pointed out that 50 per cent. of the inquiries under this Act had failed, and I was endeavouring to find out where they had failed.

The CHAIRMAN: I do not take exception to that being replied to, but I thought the hon. Member was suggesting there was an unconscious bias in these committees. That would be a fair point to take, but to go over the whole question cannot be done.

Mr. BARNES: I was endeavouring to prove that in the secondary trades the bias came out in administration, but when you come to another range of industries in this country it was impossible to get them through because of bias. However, I do not want to emphasise that if I am out of order. I should like to refer to the remarks made by the hon. Member for Reading (Mr. H. Williams) when he stated that, as far as the position of Mr. Hayhurst is concerned, his connection with the pottery owned by the Co-operative Wholesale Society no doubt biased him.

Mr. H. WILLIAMS: I did not say anything of the kind.

Mr. BARNES: At any rate, the hon. Member has referred to a guaranteed market which the Co-operative Wholesale Society had. As a matter of fact, may I point out to him that a Co-operative Wholesale Society factory has no more guaranteed market than any other factory in this country? Each retail co-operative society has perfect freedom to buy their goods wherever they like. As a matter of fact, if the Co-operative Wholesale Society production were to move above the current manufacturing prices for these articles, the buyers for the retail society who have to hold their trade, the trade of their members, against the general competitive prices, would be compelled to go past the Co-operative Wholesale Society for the purpose of buying their commodities. As a matter of fact, that happens time after time. If the hon. Member would familiarise himself with co-operative buying a little more, he would find repeatedly in the Co-operative Wholesale Society complaints of the absence of loyalty on the part of the retail buyers. You do not find the co-operative, system perfect all along the line, any more than any other industrial organisation, and its
weakness develops in administration, but you will find that that is put right by the economic reaction of prices.

Mr. H. WILLIAMS: How is it that this inefficient factory is able to make a reasonable profit when less efficient factories are not?

Mr. BARNES: It shows that the operation of the ring is effective.

Mr. WILLIAMS indicated dissent.

Mr. BARNES: The hon. Member disagrees with that, but I assert that prices are affected in this industry by a great decision between the manufacturers as to the prices they charge. If one doubts that, will the hon. Member try to explain how it is that in this bone china before the War you could get an ordinary set for 3s. or 4s. and this has jumped to 13s. 11d.? It is absurd to argue that the manufacturing costs have moved in that direction, because the bulk of the factories and plant were erected and in operation before the War. Wages have not moved to anything like that extent, so that no one can argue that is the reason for that. With regard to the question of prices, again I should like to assert that this duty has been passed on to the consumer, and I want to prove it by quoting a particular set I have in front of me. Take the ordinary set purchased before the War at 3s. 3d. and sold for 4s. 11d. That set moved to 5s. 5d. prior to the imposition of this duty, but to-day if you wish to buy that particular tea-set—just an ordinary set in common use in working-class homes—you would have to pay 6s. 11d. to be sold at 9s. 6d. I agree, if I might refer to artificial silk for a passing moment, that where you have a newly-developed industry, as the total output increases prices are naturally falling, and I agree that for a period the imposition of taxation of this sort can be hidden; but when you come to a well-established industry of this sort, where the production and the volume of production are not Materially affecting prices, I state without any hesitation that at the present moment, whatever may happen ultimately, this duty which has been imposed has passed to the consumer, and is being passed to the consumer. But that is not all. One of the reasons why I—although I do not stand here merely
as an automatic and fanatical Free Trader—oppose any imposition of tariffs or safeguarding in this country is, that ultimately it leads to a more intense exploitation of the consumer, and a more intense exploitation of the producer.
In the first place, if you impose a duty, it does not matter whether it is levied from the point of view of raising taxation as such or for the purpose of keeping out goods that are imported. Eventually it must go into price, and if it goes into price and the retailer or manufacturer has to collect that tax for the Government, it means that ultimately he must have more capital in his business, because the rise in the goods that he purchases necessitates a greater outlay on his part. What happens in respect to that? Every industry, broadly and roughly speaking, has to provide its own additional capital. How does it provide that? By enlarging and widening the margin between the cost of production and what the consumer pays. That is the only way by which industry ultimately provides the additional capital that is necessary either through inflation or an artificial system of increasing prices by tariffs. Take that one set I have mentioned. I wish to illustrate the general argument by that one set. Before the War it was purchased for 3s. 3d. and sold for 4s. 11d. The gross profit was 1s. 8d., representing 34 per cent on price. Because of this duty that is imposed on that set, and the natural rise in prices because of inflation, the price of that 3s. 3d. set comes to 6s. 11d. Obviously, every person who is engaged in that industry must roughly double his capital to stock the same range of goods as he did before the War, and I say without any hesitation that that additional capital does not come from saving, but from a more intense exploitation of the producer and the consumer from 1914 to 1926.
But that does not end the story, because that article is sold for 9s. 6d. The gross profit of 1s. 8d. on that set in 1913 now jumps to 2s. 7d., an item of 11d. represented in the value of gross profit which, although it is only 27 per cent. to-day as against 34 per cent. in 1913, takes an additional 11d. out of the consumer. This with the 1s. 6d. in tax that I assert
this duty represents on that class of tea-set means a total of 2s. 5d.—an artificial price. It is not represented in the cost of labour or in overhead charges or by foreign competition or matters of that sort, but an additional 2s. 5d. is taken out of the productive power of the workmen of the country. When hon. Members opposite get up, and with that kind of emotional appeal to this House and through this House to the electors of this country, say that this system of tariffs is devised for the purpose of putting people into employment in this country, I say there are plenty of ways of putting people into employment in this country Cut down the vast expenditure on—

The CHAIRMAN: Really, the hon. Member must keep to the point.

Mr. BARNES: I would hesitate to disagree with your ruling. I have sat all through this Debate and I assert without any hesitation that many Members have travelled far wider than I have, and if the hon. Member for Macclesfield (Mr. Remer) and the hon. and gallant Member for Bournemouth (Sir H. Croft) can make a reference in a general way to, these problems, I am entitled to. However, I close with the observation I made before, that this system of imposing a tariff through safeguarding an industry of this sort would not benefit either employment or workers in this country, but lead eventually to a widening of the margin between what the workers get in wages and what they have to pay in prices.

Mr. E. BROWN: The hon. Member for Reading (Mr. H. Williams) has alluded to the reference of the hon. Member for South-West Bethnal Green (Mr. Harris) to London and said he was selfish and narrow because he said the unemployment rate in London was less than in the Potteries, and the hon. Member for Reading was rebuking the hon. Member for Dewsbury (Mr. Riley) for taking an average, and yet he committed the same sin himself. If he will consider the conditions of parts of London which will be mostly hit by this duty, he will find that the rate of unemployment in the areas of those parts of London is much heavier than in the Potteries where this particular industry is situated. It is useless for the hon. Member for Reading to take a selected case like that and leave out the
parts which will be most hit by the putting on of a tariff like the tax on pottery.
I want to say one other word. It is about unemployment. We do not believe that the imposition of this duty of 28s. per cwt. on translucent and vitrified pottery will make more employment in the pottery industry which made application for this duty, for I think it is clearly shown in the evidence that a great part of the competition from which the bone china section of the industry has suffered did not come from abroad at all, but came from the manufacturers in the very same area. It did not come from manufacturers abroad paying low wages, but from the same trade paying the same wages in the same joint industrial council in the county of Staffordshire itself. We are against this tax because, first of all, we disagree with taking selected industries and giving them artificial protection on a separate basis, quite apart from the general argument of Free Trade and Protection; and when we get an industry like this which puts up a case, and in the course of putting up the case before the Committee refuses to produce its balancesheet—it is the first time in any of these inquiries into safeguarding that the applicant has refused—

Mr. REMER: I challenge that statement.

Mr. BROWN: If the hon. Gentleman will read the minutes of evidence he will find that the opponents' counsel made the statement in the course of the argument and asked for a production of the balance sheets, and they were not produced.

Mr. REMER: And he afterwards apologised.

7.0.p. m.

Mr. BROWN: Well, he is entitled to his opinion, and I am entitled to mine, after reading the evidence. They did not produce the balance sheets. More than that, the evidence shows on the point of employment in the bone china section that there were no figures for that section of the industry to show what the rate of employment was in that particular section. Further, the evidence went to show that when it was a question of foreign competition no proof was given that the sweated rates of wages referred to by
the hon. Member for Macclesfield (Mr. Remer) had anything to do with the difference in price between felspar china imported from abroad and bone china made in these small factories employing 7,000 people in Staffordshire. Counsel for the opponents actually made not only the statement referred to by the hon. Member for West Leicester (Mr. PethickLawrence), but a further statement
which he said:
I will make another assertion. If the Longton manufacturers got their wages and firing and their materials for nothing, their overhead charges would still be more than the whole cost of the felspar china.
I think that is conclusive proof, which was not denied by the applicants in the course of the hearing, that the question of sweated wages does not come into this at all, and, as a matter of fact, the competition is more from the other branch of the trade, which did not associate itself with the application, than from foreign competition.
I do not think the nation as a whole appreciates the range of articles to be affected by the imposition of the tax. If you turn to Appendix A of the Report, the list of articles to be taxed at 28s. in the cwt. is an amazing one. It includes tea sets and component parts thereof; dinner sets and component parts thereof; morning sets; fruit or berry sets; dessert sets; breakfast sets; cups and saucers, all sizes, including cream soup cups, chocolate cups, sherbet cups, custard cups and all kinds of other cups, including egg cups; covered muffins of all sizes; and butter dishes. I think the public outside does not understand how wide is the range of these articles, and I propose to read a few more so that the public may know what is being taxed. The list includes tea-pots, coffee-pots, cocoa-pots, chocolate-pots and covered jugs of all sizes, sweet dishes, bon-bon dishes; oatmeal plates and bowls, and salad bowls—and that will make an appeal to the hon. Member for one of the divisions of Glasgow—nappies, round or square—I do not know what they are, but no doubt other hon. Members will know—sardine boxes, cheese dishes, covered jars, tea infusers, tea-tasting cups, milk or drinking horns, beakers, toast racks, butter pads, dessert dishes, fruit saucers, olive trays, pickle trays, sugar boxes, bread and butter plates; jugs, milk, cream, hot-water and syrup
of ail sizes; ash trays or bowls, grapefruit bowls, plates of all sizes, including service plates, whether flat or deep, and oyster plates; cress plates, salad plates and asparagus plates, bakers or pie dishes, cruets, powder boxes, egg-stand frames; biscuit jars, and of course the final item of, mugs of all sizes and kinds with one handle or more. I think the time has come when we might very well revive in this country the old art of the lampoon. I was wandering in a museum the other day looking at pottery, and among the articles I found was a spittoon on which was inscribed:
I will spit on William Pitt.
Obviously political feeling in those days against William Pitt, the great statesman, was so strong that they inscribed a lampoon on their spittoons. I think if this kind of duty is to go on we shall have to inscribe on our spittoons
I spat on Winston's hat,
or something of that kind, so that the people who do not read our Debates will understand all about the ridiculous taxes to which this ridiculous Government and the President of the Board of Trade are subjecting the country. There is one other point about this range of articles. I have here a letter from a firm giving four lines of articles and showing how this tax of 28s. per cwt. will adversely affect the prices. First of all, there are tea-sets. The value of these sets is £10 4s. 2d. and their weight is 418 1bs. A tax of 28s. per cwt. will work out at £5 2s. on that 418 1bs., that is, just 50 per cent. The second line is a line of jugs. Their value is £5 4s. 2d. and their weight 332 1bs., and a tax will work out at £4 3s. 0d., or considerably more than 65 per cent. on the 332 1bs. The third line is a line of cups, the value being £3 6s. 8d. and the weight 242 1bs. The amount of the tax will be £3 0s. 6d., or nearly 100 per cent. on the 242 1bs. The fourth line is a line of cups and saucers—the china used by the poor people referred to by the hon. Member for Southwest Bethnal Green and the hon. Member for West Leicester. This line is valued at £5 4s. 2d., and the weight is 440 1bs. The tax will work out at £5 10s. 0d. This very firm has 250 branches up and down the country, and this will be the result. My hon. Friend the Member for North Lambeth (Mr. Briant) has been accustomed
to run a camp for boys of South London in the country, and he has always been able up to this year to give them an earthenware vitrified cup from which to drink. He was able to buy these before this year at 3d., but when he comes to this same firm to buy cups for this year's camp he is told that the price is up above the level at which they were sold before, and he has to content himself with enamel cups instead of china cups. [Laughter.] Hon. Members may laugh, but it is no laughing matter that a tax of this kind should prevent children living in the slums of London from having the comparative joy of drinking out of these china cups rather than an enamel cup. Those of us who served in the Army know perfectly well that enamel cups are not the best kind of drinking instruments to have.
On these and other grounds this Committee ought to oppose this duty to the very last possible moment. The tax is bad, and the evidence, before the Committee, in my judgment, did not justify the imposition of the tax, and especially it did not justify its extension to that part of pottery which was not asked for by the applicants, namely, vitrified pottery, which was not included in the application. I oppose this duty with all my heart.

Commander WILLIAMS: I hope when the hon. Gentleman who has just sat down proceeds to elaborate the speech he has just made in different parts of the country—

Mr. BROWN: Nothing of the kind.

Commander WILLIAMS: —he will not omit to give the information that the originator of the Safeguarding of Industries was the very respectable Leader of the Liberal party, the Prime Minister of the Coalition Government—

Mr. BROWN: I opposed it at the time.

Commander WILLIAMS: That interruption is not very relevant.

Mr. BROWN: It is quite relevant.

Commander WILLIAMS: But everyone knows that in these respects one Liberal never supports another Liberal.

Mr. BROWN: Or one Tory another on the Lords question.

Commander WILLIAMS: My real object in rising was to draw attention to two or three points which have been raised. Both the hon. Gentleman who is now sitting on the front Opposition bench and the late Chancellor of the Exchequer poured out a very considerable amount of abuse on these Committees—though perhaps not as strong as they poured out on the Chancellor of the Exchequer—but they poured out much abuse on the Committees which have had to deal with this matter. These Committees, after all, are doing the public service. They have no means of defending theémselves, and I think it is not quite up to the high standard of the House of Commons for hon. Members, and particularly the late Chancellor of the Exchequer, to say that these Committees do not endeavour to do their work fairly, honestly and in the interests of the nation as a whole. I believe that members of all parties, to whatever section they belong, if put on this type of Committee would try to give their decision with the same honourable intention, and I believe the front bench of the Opposition would do if any of them were on these Committees.
To leave that point, I think the right hon. Gentleman the ex-Chancellor of the Exchequer has advanced a long way this afternoon in the admissions he has made. He made the admission that his position as regards mathematics was not quite so strong as it might be. That was known to many of us, but he went on from that to say that he left the Tariff Reform League to work out these matters, presumably because of their greater accuracy. I think that that, coming from him, shows the very great value of the very large number of figures on this question of safeguarding which have been brought out by various parties who believe it is essential in the interests of the country that as a whole we should have a measure of safeguarding such as is contained in this particular Clause. I do not wish to take up much of the time of the Committee, but there is a point which was raised in regard to the proceedings of the Committee which inquired into this industry, and which was raised by the ex-Chancellor of the Exchequer, as to why the workers in that industry did
not take any part in giving evidence before the inquiry. I think it is the very clear and simple reason that, unfortunately, in many places in this country at the present time the workers instead of looking after their industry—or rather the leaders of the workers—are much too engaged in political matters.

The CHAIRMAN: I am afraid the hon. Member is now opening up an entirely new discussion.

Commander WILLIAMS: I had no intention of following that up, but was only replying to the point raised that the workers took no part in this discussion, and to express a wish that in this matter of safeguarding the workers would take a very clear and definite part, because I am convinced in my own mind that this Clause is probably one of the most valuable Clauses in the whole of the Budget and it certainly will have my support.

Mr. MacLAREN: I do not think the hon. Member would have made the remark he has just dropped if he knew the facts. Unfortunately for his case, it so happens there are few industries in this country where employers and employed are more amicably agreed with one another than in the pottery industry.

Commander WILLIAMS: I quite agree, and that particular point has been made before several times in the course of this afternoon, as the hon. Member would know if he had heard all the Debate. I was replying to the point raised by one of his leaders on the Front Opposition bench that the workers did not take part in this inquiry, and I was saying quite clearly I wished they had taken a part. If it be the case, as the hon. Member opposite says, that the workers and employers are working in absolute harmony in this question, then I congratulate the trade and only wish that was extended further.

Mr. MacLAREN: I am afraid the hon. Member does not get exactly what I mean. The point made was that they were deflected by economic and political considerations, rather than attending to their own particular business. I want to assure the hon. and gallant Member that that is not so in the Potteries. The workers
are divided very much upon this question with regard to safeguarding, but I really want to make it clear that the suggestion that they were deflected by other purposes is not true.

Commander WILLIAMS: There is some misunderstanding between us, because as I understand it, the point the hon. Member made was that the workers and employers in this particular industry were working in the closest possible alliance. Then all I say is, I congratulate the whole industry, both sides, on the success of that condition, and no one would wish to make it any different. To come back to the point to which I was referring, I wish to thank the Government for carrying out this Clause because I believe, as coming from the West country from where a very large amount of the material comes, in the shape of china-clay which is worked into this china, the Government are not merely doing something which will help enormously to encourage an industry which employs highly skilled and efficient workers in the Midlands, but which will also do something to encourage the production of raw material in the West country, which needs it very badly at the present time. I thank the Government most sincerely from the point of view of helping the unemployed, and from the point of view of encouraging trade and manufacture and enabling the Britisher to get an article in this country which, under a better scheme of production, there is no earthly reason why it should not be not only better in quality but not so expensive as the foreign article.

Mr. CRAWFURD: I would not have intervened in this Debate had it not been for the fact that the hon. Member for Macclesfield (Mr. Remer), by his intervention during the speech of the hon. Member for Leith (Mr. E. Brown), has repeated an allegation which he made during the discussion on the Report Stage of the Resolution. During these discussions I have made two complaints with regard to the procedure adopted in connection with the safeguarding of industries. I have complained in the first place of the action of the President of the Board of Trade in the appointments he has made to these Committees, and I do not feel in the least abashed by what
has been said by the hon. Member for Torquay (Commander Williams). No one on this side of the House will believe that any of these Committees are consciously misrepresenting the evidence they hear. What we say is that people who have a strong bias in one direction, whether they may be members of a Committee or Members of this House, cannot possibly prevent that bias influencing them in the decision they make. The second complaint which I have made, is that this House is supposed to base its judgment upon these duties upon the merits of the case, but we have never been allowed to see the evidence on which the Reports are based. In this particular case, we find that of the three members of the Committee, two took one point of view and one took another view. In other words, the Committee is as divided as it can be about the merits of the question. Even then, this House is not allowed to see the evidence upon which these members have come to their conclusions.
My next point relates to something that has been said by the hon. Member for Macclesfield, and I hope he will take this seriously, because I propose before I have finished to show to him that it is a very serious matter. On the 28th April, 1927, the hon. Member said:
A further statement was made that the manufacturers who were the applicants in this case refused their balance sheets. That statement is not correct. The statement was made at the last minute by Mr. Comyns Carr, the counsel for the opponents, and the manufacturers made it quite clear that they had never been asked until the last minute to produce their balance sheets.
That was the statement of the hon. Member. He went on to say:
The Chairman of the Committee stated that Mr. Comyns Carr's statement was most unfair, and Mr. Comyns Carr withdrew the statement in face of what the Chairman had said."—[OFFICIAL REPORT, 28th April, 1927; col. 1088, Vol. 205]
The hon. Member made that statement in this House about someone who is not able to defend himself, because he is not here; a past Member of this House, and a very respected and very able ex-Member of this House. The hon. Member made a statement that a certain thing said by Mr. Comyns Carr was not correct, and that it was contradicted by the manufacturers. Not one of these statements of the hon. Member is true.
Every one of them is entirely untrue, and I am not saying that without producing my evidence. I have the evidence. One of the disadvantages of the procedure which the President of the Board of Trade has thought fit to pursue is that we have to pick up this evidence for ourselves when allegations of this kind are made by hon. Members opposite. One of the members of the Committee, Mr. Hayhurst, in his report says:
During the course of the inquiry there has been an evident reluctance on the part of the witnesses appearing on behalf of applicants frankly to table certain details in support of the application, and in this connection the failure of witnesses to produce balance sheets for the inspection of the Committee indicates a lack of confidence in the investigating Committee.
That is a statement of a member of the Committee. One of the people whom we are told we must respect. Further reference was made to the question of balance sheets not only at the last minute, and I want the Committee very carefully to take account of this, but on the 5th, 10th, 12th and 13th day of the inquiry. I have taken the trouble to secure a copy of the evidence on the 21st day of the inquiry and I am going to read certain passages. The question was brought up by Mr. Entwistle in regard to evidence about debentures in the Longton industry.
Mr. Entwistle: There is no evidence about debentures in the Longton industry at all.
Mr. Farraday: How can there be? They are all partnerships.
The Chairman: They are private companies.
Mr. Entwistle: No capital, no balance sheet, no anything has been produced of that kind.
The Chairman: We have had nothing at all.
Mr. Farraday: The answer is that during the time the German mark was depreciating the British pound was appreciating, so that the boot is on the other leg.
The Chairman: I do not see why we should not have had a balance sheet.
Mr. Entwistle: I do not see why we should not have been trusted.
Mr. Farraday: It was not quite a matter of trusting anyone. It is a matter of introducing irrelevant questions.
Mr. Hayhurst: I very well remember you saying that you were not going to show anything to your opponents, but we are not your opponents.
Mr. Farraday: No. You are our best friends.
Mr. Hayhurst: One hopes so, but one likes to be treated as others would treat us.
I now turn to the speech made by Mr. Comyns Carr in introducing the case for the opponents. He said:
In every inquiry I have taken part in the manufacturers in camera have produced their balance sheets for inspection. We have had no balance sheets here. We have challenged them, we have asked for them, but we have not received them. We cannot, therefore, assume that things are bad with the manufacturers.
The Chairman makes no mention whatever of the fairness or unfairness of that statement.

Mr. REMER: I think the hon. Member is a little unfair to me in bringing forward an accusation about something which happened six weeks ago, without having given me notice that he was going to do so. The Committee is entitled to an explanation. On the night before the Budget Resolutions six very responsible members of the trade met me in one of the Committee Rooms upstairs, and this statement quoted from Mr. Entwistle's remarks were referred to the Committee and it was on their answer to that statement that I made my statement in the House. I am not able to verify it now, because it has only just been sprung upon me, but it was a statement made by six people who were present at the inquiry, and it was made by me in all good faith. All I can say is that I will make inquiries into the matter, and probably deal with it on a subsequent occasion.

Mr. CRAWFURD: I thank the hon. Member for that assurance, but when it comes to a question of my bringing forward a matter without giving him notice, I may say that it was my intention to refer to this matter later this evening and to ask the hon. Member to remain in the House; but he interrupted my hon. Friend the Member for Leith and repeated his accusation. If he says that I have no right to bring forward this matter without giving him notice, he has no right to intervene, when this Committee has no means whatever of judging of the truth of what was said by the responsible or irresponsible people who supplied the information to the hon Member, particularly when he makes an assertion upon that sort of ground about someone who is not here. This is all of a piece with
what we may expect from protective duties in this country. We have always said, and it has been said this afternoon from the Front Opposition Bench, that so surely as you begin to introduce tariffs into the fabric of your finance you will get corruption, and you will get people who are simply there to get all there is to be had.

Sir H. CROFT: On a point of Order. The hon. Member has just said, as an instance of what is going to happen, that this Bill will encourage corruption. May I ask if that is an insinuation against anyone in this House?

Mr. CRAWFURD: No. Certainly not.

Sir H. CROFT: On a point of Order. Can such an insinuation be allowed?

The CHAIRMAN: I was waiting for the hon. Member to finish the sentence. I was not able to catch the drift of it.

Sir H. CROFT: He has already practically called the hon. Member for Macclesfield a liar.

Mr. CRAWFURD: The hon. Member must be very careful. He has made his point of order and that point of order has been ruled on, and I am going to reply to it very directly. Nothing that I have said contains any imputation against any Member of this House. I used the phrase "corruption," and what I mean is that not only hon. Members on the other side of the House but hon. Members on this side will be approached by people who may be interested parties in these Duties or these tariffs. It is inevitable. In every country where you have tariffs you have that kind of corruption, and you are bound to have it.

Mr. MacLAREN: The right hon. Gentleman need not sneer.

Mr. CRAWFURD: If the right hon. Gentleman the President of the Board of Trade is casting any doubts on what I am saying, the best answer that he can make on this occasion and on every other occasion is to let the House see and judge for itself the evidence on which he acts. Until he does that, and until we have that, we on this side say that these duties are being imposed by secret Committees
and by methods which are unworthy of the traditions of good finance in this country.

Captain FRASER: Will the hon. Member permit me to ask him a question? He is pleading that the Committees should produce their evidence so that Members of this House may be able to consider it. Does he think that that would facilitate the provisions by manufacturers of the very facts and figures which they must necessarily keep to themselves?

Mr. CRAWFURD: The hon. and gallant Member asks me a perfectly fair question, and my reply is that in the proceedings before these Committees the public are admitted, but some proceedings are taken in camera, and the evidence that is submitted on those occasions is the kind of evidence which manufacturers, in the interests of British industry, do not wish to make public. That protection can still be given. The main evidence on which these conclusions are come to should be put before this House, and unless that is done this House cannot come to a just conclusion.

Mr. MacLAREN: There seems to be some apprehension on the other side as to the righteousness of anyone on this side casting any reflection on the conduct of this inquiry. It was the most comical Committee I ever watched carrying on any business at all. In the Committee there was a lady, there was the Chairman, and Mr. Hayhurst, who seemed to be the only man who held strong and decided views about anything. The Chairman was non-committal, but the lady was very indiscreet very often. If I may be allowed to give an illustration of the qualities of the Committee to make such an inquiry, I think you will find that it will throw some light on the nature of the Committee, and I think the President of the Board of Trade will remember an incident connected with it, about which he was very nervous when I brought the matter up in the House. During the sittings of the Committee a very important matter was raised in connection with the comparison of hours of labour in the different countries. The question was under discussion and much was hinged upon comparative hours of labour in connection with competition. The question was raised by Mr. Faraday, who appears to be the champion of Protection
in this country and other countries. He pointed out that in Germany they worked excessive hours of labour compared with the hours in this country, but that these hours were not included in the statutory number of hours as expressed in the State documents. He said these hours were "preparatory" hours of labour. I hope the President of the Board of Trade will listen to this because it has distinct reference to an incident which he will not forget. Mr. Hayhurst asked Mr. Faraday, the champion of the Tariff Reformers, what he meant by "preparatory" hours of labour. Mr. Faraday seemed nonplussed, but suddenly the lady in the Committee, Lady Askwith, sprang upon the
Committee a very clearly defined definition of what "preparatory" work meant. She was asked what she meant because she was evidently quoting from a document. She said she had a private document, supplied to her by the President of the Board of Trade. [HON. MEMBERS: "Why not?"] I quite agree. Why not? It is interesting to know that private documents were supplied to members of the Committee to meet emergencies of that kind, but when Mr. Entwistle. who was defending the opponents, asked that this document might be submitted to him so as to prepare the case against the evidence, he was told that such a document could not be given to him, and the Chairman then ruled that witnesses had a right to submit evidence from any private document, and might refuse to submit them to the other side.
I raised the question afterwards in this House, and I do not think the President of the Board of Trade will forget that day. He had even to send round notice to the Committee that they must not in future carry on like this again, and also he instructed them that the private document made use of should be submitted to the other side. I congratulate him on having done so. I only give this as an illustration of the capacity of the Committee to make an inquiry. The lady had no right to be there at all. I am not saying that in any ungentlemanly way, but to watch the process of the Committee one could not fail to see that this lady was more governed by her political prejudices than by any capacity she might have for the job. It was very evident that there were two very strong Tariff Reformers on that Committee, and
another fighting like a good Co-operative for Free Trade. To speak of this being an impartial inquiry is sheer nonsense. I expected that the recommendations of this Committee and the evidence upon which it was based would in due course come before this House for the usual review of a debate in this Chamber. But no. I do not think sufficient is made about this point. Surely it was the understanding in this House generally, if the Safeguarding policy was to be pursued, that any recommendation made in regard to it would be the subject of a discussion, and a free discussion, in this House. None of the evidence was brought before the House and no discussion was allowed upon it. But the Chancellor of the Exchequer, looking afield for same fancy tax, landed on this wonderful child of the Committee and this duty has been adopted as one of the many ingenious devices in his Budget. I would not become very wroth about the proposal, and I would not wax hot about it, and denounce the Government for having adopted this policy. I would say to the Government now, "Keep your Safeguarding policy and double it, and put more on top of it, and you will do nothing to resuscitate the bone china industry in this country." Felspar china is a cheap shoddy which cannot compare with bone china as a finished product or as the work of a craftsman, and the dishonesty of this whole inquiry is shown by the fact that it is not the bone china industry but the earthenware industry which is being injured by the enormous importation of felspar china into this country. This felspar china is a cheap product, but has a certain amount of daintiness about it, and it is coming into this country and is being sold at a price out of all proportion to its value.
Really, it was not the bone china manufacturers at all but the earthenware manufacturers who felt that they were being displaced by this enormous importation of felspar china. The supporters of Protection in this country seized upon the bone china industry which is becoming more or less a fancy trade, and said to the Committee, "Here is an industry which cannot stand before this felspar competition." The earthenware manufacturers have been largely handicapped by this competition and if, in view of that fact, those manufacturers
had come forward and asked for safeguarding there would have been some honesty in the appeal. But they did not come forward. That is where the dishonesty comes in in regard to this inquiry. The question was raised as to why some of those who are connected with this industry did not take any interest in this inquiry. The reason is simply because they had never been asked. We are in such a position in many parts of the potteries that it is not altogether safe for many of the employés to express their political convictions. There is a good deal of intimidation. The working people were not greatly interested. The only people really interested were the earthenware manufacturers whose interest it would have been to keep down this competition of felspar china. But they did not appear in the picture—the bone china industry was brought in and now it is put forward that we must have a certain measure of protection against felspar china, and that in that way we are going to help industry in the potteries.

Well, you can double your Protection and even make it our times what it is, and yet you will not provide for the bone china industry.

There are certain technical points one could bring out to prove that case, but I refrain from doing so. I want to support and to reinforce what was said by the last speaker. I do not wish to cast any reflection on this House or on any Member of this House, but I say this, whenever you allow private interests to be a moulding force in the policy of any country, these interests will in time begin to hamper and to influence that policy. I, therefore, quite agree with what has been said regarding possible corruption in the sense of spoiling the pure stream of political thought by the intrusion of private interests. Corruption of this kind is bound to grow in connection with this kind of thing. These are my own personal views on the matter.

Question put, "That the words 'five years' stand part of the Clause."

The Committee divided: Ayes, 247; Noes, 100.

[Division No. 228.]
AYES.
[7.43 p.m.


Acland-Troyte, Lieut-Colonel
Cassels, J. D.
Fermoy, Lord


Alexander, Sir Wm. (Glasgow, Cent'l)
Cautley, Sir Henry S.
Finburgh, S.


Applin, Colonel R. V. K.
Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)
Ford, Sir P. J.


Apsley, Lord
Cecil, Rt. Hon. Sir Evelyn (Aston)
Foxcroft, Captain C. T.


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Chadwick, Sir Robert Burton
Fraser, Captain Ian


Astbury, Lieut-Commander F. W.
Chamberlain, Rt. Hon. N. (Ladywood)
Gates, Percy


Astor, Viscountess
Charteris, Brigadier-General J.
Gault, Lieut.-Col. Andrew Hamilton


Atkinson, C.
Christie, J. A.
Gibbs, Col. Rt. Hon. George Abraham


Baldwin, Rt. Hon. Stanley
Churchill, Rt. Hon. Winston Spencer
Gilmour, Lt.-Col. Rt. Hon. Sir John


Balfour, George (Hampstead)
Churchman, Sir Arthur C.
Glyn, Major R. G. C.


Barclay-Harvey, C. M.
Clarry, Reginald George
Goff, Sir Park


Barnett, Major Sir Richard
Cobb, Sir Cyril
Gower, Sir Robert


Beckett, Sir Gervase (Leeds, N.)
Cockerill, Brig.-General Sir George
Grace, John


Benn, Sir A. S. (Plymouth, Drake)
Cohen, Major J. Brunel
Graham, Fergus (Cumberland, N.)


Bennett, A. J.
Colman, N. C. D.
Grattar-Doyle, Sir N.


Berry, Sir George
Conway, Sir W. Martin
Greene, W. P. Crawford


Betterton, Henry B.
Cooper, A. Duff
Grenfell, Edward C. (City of London)


Bird, E. R. (Yorks, W. R., Skipton)
Couper, J. B.
Grotrian, H. Brent


Bird, Sir R. B. (Wolverhampton, W.)
Courthope, Colonel Sir G. L.
Gunston, Captain D. W.


Boothby, R. J. G.
Cowan, Sir Wm. Henry (Islington.N.)
Hacking, Captain Douglas H.


Bourne, Captain Robert Croft
Craig, Sir Ernest (Chester, Crewe)
Hall, Lieut.-Col. Sir F. (Dulwich)


Bowater, Col. Sir T. Vansittart
Croft, Brigadier-General Sir H.
Hammersley, S. S.


Bowyer, Capt. G. E. W.
Crooke, J. Smedley (Derltend)
Hannon, Patrick Joseph Henry


Brassey, Sir Leonard
Crookshank, Col. C. de W. (Berwick)
Harland, A.


Briggs, J. Harold
Curzon, Captain Viscount
Harrison, G. J. C.


Briscoe, Richard George
Dalkeith, Earl of
Hartington, Marquess of


Brocklebank, C. E. R.
Davidson, Major-General Sir J. H.
Harvey, G. (Lambeth, Kennington)


Broun-Lindsay, Major H.
Davies, Sir Thomas (Cirencester)
Hawke, John Anthony


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Davies, Dr. Vernon
Henderson, Capt. R. R. (Oxf'd, Henley)


Buchan, John
Dean, Arthur Wellesley
Henderson, Lt.-Col. Sir V. L. (Bootle)


Buckingham, Sir H.
Dixon, Captain Rt. Hon. Herbert
Heneage, Lieut.-Colonel Arthur P.


Bull, Rt. Hon. Sir William James
Drewe, C.
Hennessy, Major Sir G. R. J.


Bullock, Captain M.
Eden, Captain Anthony
Herbert, Dennis (Hertford, Watford)


Burman, J. B
Edmondson, Major A. J.
Hills, Major John Waller


Burton, Colonel H. W.
Ellis, R. G.
Hogg, Rt. Hon.Sir D. (St. Marylebone)


Butler, Sir Geoffrey
Elveden, Viscount
Holt, Captain H. P.


Butt, Sir Alfred
Erskine Lord (Somerset, Weston-s.-M.)
Hope, Capt. A. O. J. (Warw'k, Nun.)


Cadogan, Major Hon. Edward
Evans, Captain A. (Cardiff, South)
Hopkins, J. W. W.


Campbell, E. T.
Everard, W. Lindsay
Horne, Rt. Hon. Sir Robert S.


Carver, Major W. H.
Falle, Sir Bertram G.
Howard-Bury, Lieut.-Colonel C. K.


Hudson, Capt. A. U. M.(Hackney,N.)
Newton, Sir D. G. C. (Cambridge)
Sprot, Sir Alexander


Hume, Sir G. H.
Nicholson, O. (Westminster)
Stanley, Lieut.-Colonel Rt. Hon. G. F.


Hunter-Weston, Lt.-Gen. Sir Aylmer
Oakley, T.
Stanley, Lord (Fylde)


Huntingfield, Lord
O'Neill, Major Rt. Hon. Hugh
Stanley, Hon. U. F. G. (Westm'eland)


Hutchison, G. A. Clark (Midl'n & P'bl's)
Ormsby-Gore, Rt. Hon. William
Steel, Major Samuel Strang


Illffe, Sir Edward M.
Penny, Frederick George
Streatfeild, Captain S. R.


Jackson, Sir H. (Wandsworth, Cen'l)
Perkins, Colonel E. K.
Stuart, Crichton-, Lord C.


Jephcott, A. R.
Perring, Sir William George
Stuart, Hon. J. (Moray and Nairn)


Jones, G. W. H. (Stoke Newington)
Peto, G. (Somerset, Frame)
Styles, Captain H. W.


Kidd, J. (Linllthgow)
Pilcher, G.
Sueter, Rear-Admiral Murray Fraser


King, Commodore Henry Douglas
Pilditch, Sir Philip
Sugden, Sir Wilfrid


Lamb, J. Q.
Power, Sir John Cecil
Sykes, Major-Gen. Sir Frederick H.


Lane Fox, Col. Rt. Hon. George R.
Pownall, Sir Assheton
Tasker, R. Inigo.


Lister, Cunliffe, Rt. Hon. Sir Philip
Radlord, E. A.
Thompson, Luke (Sunderland)


Little, Dr. E. Graham
Raine, Sir Walter
Tryon, Rt. Hon. George Clement


Lloyd, Cyril E. (Dudley)
Ramsden, E.
Turton, Sir Edmund Russborough


Loder, J. de V.
Rawson. Sir Cooper
Ward, Lt.-Col. A. L. (Kingston-on-Hull)


Looker, Herbert William
Reid, D. D. (County Down)
Warner, Brigadier-General W. W.


Lougher, Lewis
Remer, J. R.
Waterhouse, Captain Charles


Lucas-Tooth, Sir Hugh Vere
Remnant, Sir James
Watson, Sir F. (Pudsey and Otley)


Luce, MaJ.-Gen. Sir Richard Harman
Rice, Sir Frederick
Watson, Rt. Hon. W. (Carlisle)


Lumley, L. R.
Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Watts, Dr. T.


Lynn, Sir Robert J.
Roberts, Sir Samuel (Hereford)
Wells, S. R.


Macdonald, Capt. P. D. (I. of W.)
Ropner, Major L.
Wheler, Major Sir Granville C. H.


Macdonald, R. (Glasgow, Cathcart)
Russell, Alexander West (Tynemouth)
White, Lieut.-Col. Sir G. Dalrymple


Macintyre, Ian
Rye, F. G.
Williams, A. M. (Cornwall, Northern)


Macmillan, Captain H.
Salmon, Major I.
Williams, Com. C. (Devon, Torquay)


Macnaghten, Hon. Sir Malcolm
Samuel, A. M. (Surrey, Farnham)
Wilson, Sir Murrough (Yorks,Richm'd)


McNeill, Rt. Hon. Ronald John
Samuel, Samuel (W'dsworth, Putney)
Wilson, R. R. (Stafford, Lichfield)


Macquisten, F. A.
Sandeman, N. Stewart
Winby, Colonel L. P.


Maitland, Sir Arthur D. Steel-
Sanderson, Sir Frank
Windsor-Clive, Lieut.-Colonel George


Makins, Brigadier-General E.
Sandon, Lord
Winterton, Rt. Hon. Earl


Malone, Major P. B.
Sassoon, Sir Philip Albert Gustave D.
Wise, Sir Fredric


Margesson, Captain D.
Savory, S. S.
Wolmer, Viscount


Mason. Lieut.-Col. Glyn K.
Scott, Rt. Hon. Sir Leslie
Womersley, W. J.


Meller, R. J.
Shaw, Lt.-Col. A.D. Mcl.(Renfrew, W.)
Wood, E. (Chest'r, Stalyb'dge & Hyde)


Merriman, F. B.
Sheffield, Sir Berkeley
Wragg, Herbert


Meyer, Sir Frank
Shepperson, E. W.
Yerburgh, Major Robert D. T.


Mitchell, S. (Lanark, Lanark)
Simms, Dr. John M. (Co. Down)
Young, Rt. Hon. Sir Hilton (Norwich)


Mitchell, W. Foot (Saffron Walden)
Sinclair, Col. T. (Queen's Univ., Belfast)



Monsell, Eyres, Com. Rt. Hon. B. M.
Slaney. Major P. Kenyon
TELLERS FOR THE AYES.—


Moore, Lieut.-Col, T. C. R. (Ayr)
Smith, R. W. (Aberd'n & Kinc'dine, C.)
Major Sir Harry Barnston and Mr.


Moore, Sir Newton J.
Smith-Carington, Neville W.
F. C. Thomson.


Murchison, Sir Kenneth
Somerville, A. A. (Windsor)



NOES.


Adamson, Rt. Hon. W. (Fife, West)
Grundy, T. W.
Scurr, John


Adamson, W. M. (Staff., Cannock)
Hall, F. (York., W.R., Normanton)
Shepherd, Arthur Lewis


Ammon, Charles George
Hall, G. H. (Merthyr Tydvil)
Shiels, Dr. Drummond


Baker, J. (Wolverhampton, Bilston)
Hardie, George D.
Short, Alfred (Wednesbury)


Baker, Walter
Harris, Percy A.
Sinclair, Major Sir A. (Caithness)


Barker, G. (Monmouth, Abertillery)
Hartshorn, Rt. Hon. Vernon
Smith, H. B. Lees (Keighley)


Barnes, A.
Hirst, G. H.
Smith, Rennie (Penistone)


Batey, Joseph
Hudson, J. H. (Huddersfield)
Snowden, Rt. Hon. Philip


Beckett, John (Gateshead)
Jenkins, W. (Glamorgan, Neath)
Spoor, Rt. Hon. Benjamin Charles


Briant, Frank
John, William (Rhondda, West)
Stamford, T. W.


Broad, F. A.
Jones, J. J. (West Ham, Silvertown)
Stephen, Campbell


Bromley, J
Jones, Morgan (Caerphilly)
Stewart, J. (St. Rollox)


Brown, Ernest (Leith)
Jones, T. I. Mardy (Pontypridd)
Strauss, E. A.


Brown, James (Ayr and Bute)
Kelly, W. T.
Sullivan, J.


Buchanan, G.
Kennedy, T.
Thornt, G. R. (Wolverhampton, E.)


Charleton, H. C.
Lawrence, Susan
Thorne, W. (West Ham, Plaistow)


Cluse, W. S.
Lawson, John James
Thurtle, Ernest


Clynes, Right Hon. John R.
Lee, F.
Tinker, John Joseph


Connolly, M.
Lowth, T.
Walsh, Rt. Hon. Stephen


Crawfurd, H. E.
Lunn, William
Watson, W. M. (Dunfermline)


Dalton, Hugh
MacLaren, Andrew
Watts-Morgan, Lt.-Col. D. (Rhondda)


Day, Colonel Harry
MacNeill-Weir, L.
Wellock, Wilfred


Dennison, R.
Morrison, R. C. (Tottenham, N.)
Welsh, J. C.


Dunnico, H.
Mosley, Oswald
Wilkinson, Ellen C.


Edwards, J. Hugh (Accrington)
Naylor, T. E.
Williams, C. P. (Denbigh, Wrexham)


Evans, Capt. Ernest (Welsh Univer.)
Oliver, George Harold
Williams, David (Swansea, East)


Fenby, T. D.
Palin, John Henry
Williams, Dr. J. H. (Llanelly)


Gardner, J. P.
Pethick-Lawrence, F. W.
Wilson, R. J. (Jarrow)


Gillett, George M.
Potts, John S.
Windsor, Walter


Gosling, Harry
Rees, Sir Beddoe
Wright, W.


Graham, D. M. (Lanark, Hamilton)
Riley, Ben



Greenall, T.
Ritson, J.
TELLERS FOR THE NOES.—


Greenwood, A. (Nelson and Colne)
Robinson, W. C. (Yorks, W. R., Elland)
Mr. Charles Edwards and Mr.


Grenfell, D. R. (Glamorgan)
Rose, frank H.
Whiteley.


Groves, T.
Scrymgeour, E.

Mr. PETHICK-LAWRENCE: I beg to move, in page 5, line 4, to leave out the words "nineteenth day of April," and to insert instead thereof, the words "first day of May."
The duty, according to the Finance Bill, comes into operation on the 19th April. My Amendment is to delay the coming into operation of the duty until 1st May. The reason for that is very simple. There were at the time when the duty was imposed a great many consignments already on their way, and when the actual days are remembered it will be seen that the Report of the Committee was on 8th April, which was the first announcement of the proposal to impose the duty, that a speech announcing the duties was made three days later, on 11th April, and then Good Friday, 15th April came, on which the Customs were closed. The Saturday following, the l6th, the Customs were closed nearly all day, and the duties came into force on the 18th. There were only 10 days between the Report of the Committee and the coming into effect of the duty, and and it will be remembered that many of these consignments came from a very long distance, and therefore started before any indication that the duty had been imposed had reached them, and some of them had been on the sea for six weeks. It is felt that this very rapid imposition of the duty before any of the consignments could be stopped is very unfair, for commitments were entered into which could not reasonably be carried out, and very great hardship arose. In cases of other countries which have imposed duties against our manufacturers our government has protested against the sudden imposition of duties of this kind.
One of the reasons given for putting on these duties rapidly is the fear of evasion. That reason cannot arise when the time has now considerably gone by, and the actual amount of goods which came into the country is known. It may be thought by some Members of the Committee that to do this retrospectively is absurd, and it could not reasonably be carried out, but, as a matter of fact, there is a definite precedent for doing this thing. In 1925 three Safeguarding Committees reported in favour of duties. They were the Cutlery, Glass and Gas Mantles Committees. The Reports were published in
November in that year, and in December Parliament was asked to give effect to these duties and to fix the date for 23rd December. These industries had already had considerable notice that the duties were to be imposed. Nevertheless, some months afterwards, the date was retrospectively altered from 23rd December to 1st January. I have here, if the Committee wish to be troubled with it, the actual order which was published by the Commissioner of Customs and Excise postponing the duties retrospectively in this way. There is, therefore, a precedent, and in view of the very great hardship which would be inflicted if the 19th April were strictly adhered to, I hope this very reasonable request will be conceded by the President of the Board of Trade on this occasion.

Sir P. CUNLIFFE-LISTER: The Treasury attach very considerable importance to this matter, and I am afraid it is quite impossible to accept the Amendment. The hon. Gentleman will remember that the Committee considered very carefully the question of dates on which this duty should come into force. The decision was that the duty should come into force forthwith. If we gave this concession to-day, it would operate in all cases, and this would be the worst case of all. The amount of the import duties in the earlier months of this year shows that the importers were fully alive to the possibility of this duty being imposed. We, therefore, could not possibly give way.

Mr. MACQUISTEN: There is another precedent for the Amendment, and it is that in 1921, when the German Reparations were on, and a number of people had bought and rebought, heavy duties were imposed, and the Chancellor of the Exchequer of that day dated back the duties to give the people who had contracts abroad time to get them in. I have a similar case in connection with motor tyres where a man had same tyres which had not actually arrived. It was on the seas, and it was going to bust his business. Notwithstanding, the fact that it is a precedent, the Treasury might in a case where it is obvious that there is no attempt at dumping, make some arrangement and not stick to the cast-iron principle as in the case of motor tyres.

Mr. E. BROWN: I regret the statement of the President of the Board of Trade, not only on the point made by the hon. and learned Member for Argyll (Mr. Macquisten), but about the duty under discussion. There is a great deal of dubiety about the pottery which comes, or does not come, under this duty, and it is extremely hard on the importers of this pottery whose articles have been ruled by the Customs and Excise unexpectedly to come within the duty. It is extremely hard on those who have forward contracts to have to face up to this duty so suddenly without any warning whatever. I, therefore, support the Amendment, which is similar to that in

the name of three of my hon. Friends but for a longer period.

Mr. GILLETT: We have as a precedent the case where the Treasury made an exception. If they have done it once they should do it again. It seems to me, in view of the importance of our business relations, which affect us more than any other country that, taking a broad view of the question, you ought to have thought that it would be wiser and in our interests to make this concession.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 236; Noes, 96.

Division No. 229.]
AYES.
[8.2 p.m.


Acland-Troyte, Lieut.-Colonel
Couper, J. B.
Hope, Capt. A. O. J. (Warw'k, Nun.)


Alexander, Sir Wm. (Glasgow, Cent'l)
Cowan, Sir Wm. Henry (Islington, N.)
Hopkins, J. W. W.


Applin, Colonel R. V. K.
Craig, Sir Ernest (Chester, Crewe)
Howard-Bury, Lieut.-Colonel C. K.


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Croft, Brigadier-General Sir H.
Hudson, Capt. A. U. M. (Hackney, N.)


Astbury, Lieut.-Commander F. W.
Crooke, J. Smedley (Derltend)
Hume, Sir G. H.


Astor, Viscountess
Crookshank, Col. C. de W. (Berwick)
Hunter-Weston, Lt.-Gen. Sir Aylmer


Atkinson, C.
Dalkeith, Earl of
Huntingfield, Lord


Baldwin, Rt. Hon. Stanley
Davidson, Major-General Sir J. H.
Hutchison, G. A. Clark (Mldl'n & P'bl's)


Balfour, George (Hampstead)
Davies, Sir Thomas (Cirencester)
Illffe, Sir Edward M.


Barclay-Harvey, C. M.
Davies, Dr. Vernon
Jephcott, A. R.


Barnett, Major Sir Richard
Davison, Sir W. H. (Kensington, S.)
Jones, G. W. H. (Stoke Newington)


Barnston, Major Sir Harry
Dawson Sir Philip
Kidd, J. (Linllthgow)


Benn, Sir A. S. (Plymouth, Drake)
Dean, Arthur Wellesley
King, Commodore Henry Douglas


Bennett, A. J.
Dixon, Captain Rt. Hon. Herbert
Lamb, J. Q.


Berry, Sir George
Drewe, C.
Lister, Cunliffe, Rt. Hon. Sir Philip


Birchall, Major J. Dearman
Edmondson, Major A. J.
Little, Dr. E. Graham


Bird, E. R. (Yorks, W. R., Skipton)
Ellis, R. G.
Lloyd, Cyril E. (Dudley)


Bird, Sir R. B. (Wolverhampton, W.)
Erskine, Lord (Somerset, Weston-s.-M.)
Loder, J. de V.


Boothby, R. J. G.
Everard, W. Lindsay
Looker, Herbert William


Bourne, Captain Robert Croft
Falle, Sir Bertram G.
Lougher, Lewis


Bowater, Colonel Sir T. Vansittart
Fermoy, Lord
Lucas-Tooth, Sir Hugh Vere


Bowyer, Captain G. E. W.
Finburgh, S.
Luce, Maj.-Gen. Sir Richard Harman


Brassey, Sir Leonard
Ford, Sir P. J.
Lumley, L. R.


Briggs, J. Harold
Foxcroft, Captain C. T.
Lynn, Sir Robert J.


Briscoe, Richard George
Fraser, Captain Ian
Macdonald, Capt. P. D. (I. of W.)


Brocklebank, C. E. R.
Gates, Percy
Macdonald, R. (Glasgow, Cathcart)


Broun-Lindsay, Major H.
Gault Lieut.-Col. Andrew Hamilton
Macmillan, Captain H.


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Gibbs, Col. Rt. Hon. George Abraham
Macnaghten, Hon. Sir Malcolm


Buchan, John
Gilmour, Lt.-Col. Rt. Hon. Sir John
McNeill, Rt. Hon. Ronald John


Buckingham, Sir H.
Glyn, Major R. G. C.
Maitland, Sir Arthur D. Steel-


Bull, Rt. Hon. Sir William James
Gower, Sir Robert
Makins, Brigadier-General E.


Bullock, Captain M.
Grace, John
Malone, Major P. B.


Burman, J. B.
Graham, Fergus (Cumberland, N.)
Margesson, Captain D.


Burton, Colonel H. W.
Grattan-Doyle, Sir N.
Mason, Lieut.-Col. Glyn K.


Butler, Sir Geoffrey
Greene, W. P. Crawford
Meller, R. J.


Butt, Sir Alfred
Greenwood, Rt. Hn. Sir H.(W'th's'w, F)
Merriman, F. B.


Cadogan, Major Hon. Edward
Grenfell, Edward C. (City of London)
Meyer, Sir Frank


Campbell, E. T.
Grotrian, H. Brent
Mitchell, S. (Lanark, Lanark)


Carver, Major W. H.
Gunston, Captain D. W.
Mitchell, W. Foot (Saffron Walden)


Cassels, J. D.
Hacking, Captain Douglas H.
Monsell, Eyres, Com. Rt. Hon. B. M.


Cautley, Sir Henry S.
Hall, Lieut.-Col. Sir F. (Dulwich)
Moore, Sir Newton J.


Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)
Hammersley, S. S.
Murchison, Sir Kenneth


Cecil, Rt. Hon. Sir Evelyn (Aston)
Hannon, Patrick Joseph Henry
Newton, Sir D. G. C. (Cambridge)


Chadwick, Sir Robert Burton
Harland, A.
Nicholson, O. (Westminster)


Chamberlain, Rt. Hon. N. (Ladywood)
Harrison, G. J. C.
Oakley, T.


Charteris, Brigadier-General J.
Hartington, Marquess of
Penny, Frederick George


Christie, J. A.
Harvey, G. (Lambeth, Kennington)
Perkins, Colonel E. K.


Churchill, Rt. Hon. Winston Spencer
Hawke, John Anthony
Perring, Sir William George


Churchman, Sir Arthur C.
Henderson, Capt. R.R. (Oxf'd, Henley)
Peto, G. (Somerset, Frome)


Clarry, Reginald George
Henderson, Lt.-Col. Sir V. L. (Bootle)
Pilcher, G.


Clayton, G. C.
Heneage, Lieut.-Colonel Arthur P.
Pilditch, Sir Philip


Cobb, Sir Cyril
Hennessy, Major Sir G. R. J.
Power, Sir John Cecil


Cockerill, Brig.-General Sir George
Herbert, Dennis (Hertford, Watford)
Pownall, Sir Assheton


Colman, N. C. D.
Hills, Major John Waller
Radford, E. A.


Conway, Sir W. Martin
Hogg, Rt. Hon. Sir D.(St.Marylebone)
Raine, Sir Walter


Cooper, A. Duff
Holt, Capt. H. P.
Ramsden, E.


Rawson, Sir Cooper
Skelton, A. N.
Watson, Sir F. (Pudsey and Otley)


Reid, D. D. (County Down)
Slaney, Major P. Kenyon
Watson, Rt. Hon. W. (Carlisle)


Remer, J. R.
Smith, R. W. (Aberd'n & Kinc'dine, C.)
Watts, Dr. T.


Remnant, Sir James
Smith-Carington, Neville W.
Wells, S. R.


Rice, Sir Frederick
Somerville, A. A. (Windsor)
Wheler, Major Sir Granville C. H.


Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Sprot, Sir Alexander
White, Lieut.-Col. Sir G. Dalrymple


Roberts, Sir Samuel (Hereford)
Stanley, Lieut.-Colonel Rt. Hon. G. F.
Williams, A. M. (Cornwall, Northern)


Ropner, Major L.
Stanley, Lord (Fylde)
Williams, Com. C. (Devon, Torquay)


Russell, Alexander West (Tynemouth)
Stanley, Hon. O. F. G. (Westm'eland)
Williams, Herbert G. (Reading)


Rye, F. G.
Steel, Major Samuel Strang
Wilson, R. R, (Stafford, Lichfield)


Salmon, Major I.
Streatfeild, Captain S. R.
Winby, Colonel L. P.


Samuel, A. M. (Surrey, Farnham)
Stuart, Hon. J. (Moray and Nairn)
Windsor-Clive, Lieut.-Colonel George


Samuel, Samuel (W'dsworth, Putney)
Styles, Captain H. W.
Winterton, Rt. Hon. Earl


Sandeman, N. Stewart
Sueter, Rear-Admiral Murray Fraser
Wise, Sir Fredric


Sanders, Sir Robert A.
Sugden, Sir Wilfrid
Wolmer, Viscount


Sanderson, Sir Frank
Sykes, Major-Gen. Sir Frederick H
Womersley, W. J.


Sandon, Lord
Tasker, R. Inigo.
Wood, E. Chest'r, Stalyb'dge & Hyde)


Sassoon, Sir Philip Albert Gustave D.
Thompson, Luke (Sunderland)
Wragg, Herbert


Savery, S. S.
Tinne, J. A.
Yerburgh, Major Robert D. T.


Shaw, Lt.-Col. A. D. Mcl. (Renfrew.W.)
Tryon, Rt. Hon. George Clement
Young, Rt. Hon. Sir Hilton (Norwich)


Sheffield, Sir Berkeley
Vaughan-Morgan. Col. K. P.



Shepperson, E. W.
Ward, Lt.-Col. A. L.(Kingston-on-Hull)
TELLERS FOR THE AYES.—


Simms, Dr. John M. (Co. Down)
Warner, Brigadier-General W. W.
Mr. F. C. Thomson and Captain


Sinclair, Col. T. (Queen's Univ., Belfast)
Waterhouse, Captain Charles
Viscount Curzon.


NOES.


Adamson, Rt. Hon. W. (Fife, West)
Hall, F. (York, W. R., Normanton)
Scrymgeour, E.


Adamson, W. M. (Staff., Cannock)
Hall, G. H. (Merthyr Tydvil)
Scurr, John


Ammon, Charles George
Hardie, George D.
Shepherd, Arthur Lewis


Baker, J. (Wolverhampton, Bilston)
Harris, Percy A.
Shiels, Dr. Drummond


Baker, Walter
Hartshorn, Rt. Hon. Vernon
Short, Alfred (Wednesbury)


Barker, G. (Monmouth, Abertillery)
Hirst, G. H.
Smith, H. B. Lees (Keighley)


Barnes, A.
Hudson, J. H. (Huddersfield)
Smith, Rennie (Penistone)


Batey, Joseph
Jenkins, W. (Glamorgan, Neath)
Snowden, Rt. Hon. Philip


Beckett, John (Gateshead)
John, William (Rhondda, West)
Spoor, Rt. Hon Benjamin Charles


Broad, F. A.
Jones, J. J. (West Ham, Silvertown)
Stamford, T. W.


Bromley, J.
Jones, Morgan (Caerphilly)
Stephen, Campbell


Brown, Ernest (Leith)
Jones, T. I. Mardy (Pontypridd)
Stewart, J. (St. Rollox)


Brown, James (Ayr and Bute)
Kelly, W. T.
Strauss, E. A.


Buchanan, G.
Kennedy, T.
Sullivan, Joseph


Charleton, H. C.
Lawrence, Susan
Thorne, G. R. (Wolverhampton, E.)


Cluse, W. S.
Lawson, John James
Thorne, W. (West Ham, Plaistow)


Clynes, Rt. Hon. John R.
Lee, F.
Thurtle, Ernest


Connolly, M.
Lowth, T.
Tinker, John Joseph


Dalton, Hugh
Lunn, William
Walsh, Rt. Hon. Stephen


Day, Colonel Harry
MacLaren, Andrew
Watson, W. M. (Dunfermline)


Dennison, R.
MacNeill-Weir, L.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Edwards, J. Hugh (Accrington)
Morrison, R. C. (Tottenham, N.)
Wellock, Wilfred


Evans, Capt. Ernest (Welsh Univer.)
Mosley, Oswald
Welsh, J. C.


Fenby, T. D.
Naylor, T. E.
Wilkinson, Ellen C.


Forrest, W.
Oliver, George Harold
Williams, C. P. (Denbigh, Wrexham)


Gardner, J. P.
Palin, John Henry
Williams, David (Swansea, East)


Gillett, George M
Pethick-Lawrence, F. W.
Williams, Dr. J. H. (Llanelly)


Gosling, Harry
Potts, John S.
Wilson, R. J. (Jarrow)


Graham, D. M. (Lanark, Hamilton)
Rees, Sir Beddoe
Windsor, Walter


Greenall, T.
Riley, Ben
Wright, W.


Grenfell, D. R. (Glamorgan)
Ritson, J.



Groves, T.
Robinson, W.C. (Yorks, W. R., Elland)
TELLERS FOR THE NOES.—


Grundy, T. W.
Rose, Frank H.
Mr. Charles Edwards and Mr.




Whiteley.

Mr. PETHICK-LAWRENCE: I beg to move, in page 5, line 7, to leave out the words "or vitrified pottery."
The reason I ask for the omission of these words is that vitrified pottery was not really a subject of inquiry at all. Vitrified pottery, in the view of the trade, means earthenware. It does not mean china, and, when the inquiry was fixed to deal with china, it was supposed that all forms of earthenware would be excluded from any question of duty. It was, therefore, a very great surprise to the trade,
after the terms of reference and after the way in which the question had been handled, that at the last minute vitrified pottery was included with translucent pottery in the proposals of the Committee. If there had been any suggestion from the beginning that vitrified pottery would be included, evidence ought to have been given in regard to the earthenware which would be classed under that description. But, as there was no expectation that it would be so included, all evidence relating to earthenware was most carefully
excluded from the inquiry. No figures were given, and it was confidently supposed that the inquiry would be confined to translucent pottery. There are very large numbers of articles which, in the general definitions of the trade, are included in this term. It is, therefore, very difficult to know what will be admitted free of duty. When the proposal came into force, the greatest confusion prevailed, and the importers were in doubt whether every article of earthenware should not be included under these terms. I understand that the Customs officials have not taken an extreme view and included all sorts of articles that could possibly be described as vitrified pottery, but they have confined themselves to a certain number, and, in that respect, the situation is better than it possibly might have been.
The fact remains that the very greatest uncertainty and difficulty prevails at the present time as to what is going to be included and what is to be excluded, and it is largely because of that difficulty that we suggest that vitrified pottery should be omitted from the scope of this taxation. It is exceedingly harassing, because it includes a great number of articles which are certainly not translucent pottery or china, and it creates the utmost confusion because, where you are dealing with portions of a trade in this way, it is exceedingly difficult to know what will or what will not be included by the Customs. Therefore, I hope the right hon. Gentleman the President of the Board of Trade, who, I think, rather unnecessarily ruled out our last Amendment, which was a small one, will not do that on this occasion, but will make this concession largely in the interests of clarity, so that people may know what imports will be subject to taxation and what will not.

Sir B. CHADWICK: In reference to what the hon. Gentleman has said I may say that the word ''vitrified" was introduced for the sake of clarity, and in order that the duty shall operate as it is intended to operate, it was thought by the Committee that the word should be introduced. Though the china now imported is translucent, it might be made non-translucent by the introduction of oxide, and therefore the Committee has recommended that the duty shall extend to all vitrified pottery.
I should like to give the Committee a definition of vitrified pottery. I want to give the hon. Member the actual facts as to what takes place, and how the introduction of these words will relieve the Customs officials instead of embarrassing them as he suggests. In general language the expression "vitrified" may be explained in this way. In the manufacture of glass various materials such as sand, soda and potash are mixed and raised to a high temperature so that they fuse or melt and flow together. Precautions are, of course, normally taken to see that the resulting product is colourless.
Glass is pre-eminently a vitrified product. In the case of china, various clays are mixed with certain fluxes, easily fusible bodies. When the temperature is raised, the fluxes melt with some of the material in the body and form what may be regarded roughly as a vitreous or glassy mass in which the unfused particles of clay are disseminated. That is vitrified pottery. Let me also give the Committee a clear definition of earthenware; a great deal has been said about the difficulty of distinguishing earthenware from translucent pottery. In the case of earthenware there is no component in the body which melts or flown at the temperature at which the body is fired. That is unvitrified pottery. The vitrified pottery is non-porous while the unvitrified pottery is porous and this is the clear distinction between china and porcelain on the one hand and earthenware on the other. I hope that explanation will satisfy the hon. Member and will clear away any confusion which may exist in his mind.

Mr. E. BROWN: I accept the explanation given by the Parliamentary Secretary in so lucid a form. The term "vitrified pottery" will bring inside this duty a great range of articles which are commonly consumed by the poorest people, because they are the heavier ware. It is our contention that this range of articles was not inside the terms of reference, and I therefore join with the hon. Member in opposing this duty. We consider that the Committee had no right to go outside their terms of reference and recommend a duty on articles which are not within their terms of reference.

Question put: "That the words proposed to be left out stand part of the clause."

The Committee divided: Ayes, 228; Noes, 95.

Division No. 230.]
AYES.
[8.20 p.m.


Acland-Troyte, Lieut.-Colonel
Gates, Percy
Pilcher, G.


Alexander, Sir Wm. (Glasgow, Cent'l)
Gault, Lieut.-Col. Andrew Hamilton
Pilditch, Sir Philip


Applin, Colonel R. V. K.
Gibbs, Col. Rt. Hon. George Abraham
Power, Sir John Cecil


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Pownall, Sir Assheton


Astbury, Lieut.-Commander F. W.
Glyn, Major R. G. C.
Radford, E. A.


Astor, Viscountess
Grace, John
Raine, Sir Walter


Atkinson, C.
Graham, Fergus (Cumberland, N.)
Ramsden E.


Balfour, George (Hampstead)
Grattan-Doyle, Sir N.
Rawson, Sir Cooper


Barclay-Harvey, C. M.
Greene, W. P. Crawford
Reid, D. D. (County Down)


Barnett, Major Sir Richard
Greenwood, Rt. Hn. Sir H.(W'th's'w,E)
Remer, J. R.


Barnston, Major Sir Harry
Grenfell, Edward C. (City of London)
Remnant Sir James


Benn, Sir A. S. (Plymouth, Drake)
Grotrian, H. Brent
Rice, Sir Frederick


Bennett, A. J.
Gunston, Captain D. W.
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Berry, Sir George
Hacking, Captain Douglas H.
Roberts, Sir Samuel (Hereford)


Betterton, Henry B.
Hall, Lieut. Col. Sir F. (Dulwich)
Ropner, Major L.


Birchall, Major J. Dearman
Hammersley, S. S.
Russell, Alexander West (Tynemouth)


Bird, E. R. (Yorks, W. R., Skipton)
Hannon, Patrick Joseph Henry
Rye, F. G.


Bird, Sir R. B. (Wolverhampton, W.)
Harland, A.
Samuel, A. M. (Surrey, Farnham)


Boothby, R. J. G.
Harrison, G. J. C.
Samuel, Samuel (W'dsworth, Putney)


Bourne, Captain Robert Croft
Hartington, Marquess of
Sandeman, N. Stewart


Bowater, Col. Sir T. Vansittart
Harvey, G. (Lambeth, Kennington)
Sanders, Sir Robert A.


Bowyer, Capt. G. E. W.
Hawke, John Anthony
Sanderson, Sir Frank


Brassey, Sir Leonard
Henderson, Capt. R. R.(Oxf'd, Henley)
Sandon, Lord


Briggs, J. Harold
Henderson, Lt.-Col. Sir V. L. (Bootle)
Sassoon, Sir Philip Albert Gustave D.


Briscoe, Richard George
Heneage, Lieut.-Colonel Arthur P.
Savery, S. S.


Brocklebank, C. E. R.
Hennessy, Major Sir G. R. J.
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)


Broun-Lindsay, Major H.
Herbert, Dennis (Hertford, Watford)
Sheffield, Sir Berkeley


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hills, Major John Waller
Shepperson, E. W.


Buchan, John
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Simms, Dr. John M. (Co. Down)


Buckingham, Sir H.
Holt, Captain H. P.
Sinclair, Col. T. (Queen's Univ., Belfast)


Bull, Rt. Hon. Sir William James
Hope, Capt. A. O. J. (Warw'k, Nun.)
Skelton, A. N.


Bullock, Captain M.
Hopkins, J. W. W.
Slaney, Major P. Kenyon


Burman, J. B.
Howard-Bury, Lieut.-Colonel C. K.
Smith, R.W. (Absrd'n & Kinc'dine. C.)


Burton, Colonel H. W.
Hudson, Capt. A. U. M. (Hackney, N.)
Smith-Carington, Neville W.


Butler, Sir Geoffrey
Hume, Sir G. H.
Somerville, A. A. (Windsor)


Butt, Sir Alfred
Hunter-Weston, Lt.-Gen. Sir Aylmer
Sprot, Sir Alexander


Cadogan, Major Hon. Edward
Huntingfield, Lord
Stanley, Lieut.-Colonel Rt. Hon. G. F.


Campbell, E. T.
Hutchison, G. A. Clark (Mldl'n&P'bl's)
Stanley, Hon. O. F. G. (Westm'eland)


Carver, Major W. H.
Illffe, Sir Edward M.
Steel, Major Samuel Strang


Cassels, J. D.
Jephcott, A. R.
Streatfield, Captain S. R.


Cautley, Sir Henry S.
Kidd, J. (Linllthgow)
Stuart, Hon. J. (Moray and Nairn)


Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)
King, Commodore Henry Douglas
Styles, Captain H. W.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Lamb, J. Q.
Sueter, Rear-Admiral Murray Fraser


Chadwick, Sir Robert Burton
Lister, Cunliffe, Rt. Hon. Sir Philip
Sugden, Sir Wilfrid


Charteris, Brigadier-General J.
Little, Dr. E. Graham
Sykes, Major-Gen. Sir Frederick H.


Christie, J. A.
Lloyd, Cyril E. (Dudley)
Tasker, R. Inigo.


Churchill, Rt. Hon. Winston Spencer
Loder, J. de V.
Thompson, Luke (Sunderland)


Churchman, Sir Arthur C.
Looker, Herbert William
Thomson, F. C. (Aberdeen, S.)


Clarry, Reginald George
Lougher, Lewis
Tinne, J. A.


Clayton, G. C.
Lucas-Tooth, Sir Hugh Vere
Tryon, Rt. Hon. George Clement


Cobb, Sir Cyril
Luce, Maj.-Gen. Sir Richard Harman
Vaughan-Morgan, Col. K. P.


Cochrane, Commander Hon. A. D.
Lumley, L. R.
Ward, Lt.-Col. A.L.(Kingston-on-Hull)


Colman, N. C. D.
Lynn, Sir R. J.
Warner, Brigadier-General W. W.


Conway, Sir W. Martin
Macdonald, Capt. P. D. (I. Of W.)
Waterhouse, Captain Charles


Couper, J. B.
Macdonald, H. (Glasgow, Cathcart)
Watson, Sir F. (pudsey and Otley)


Cowan, Sir Wm. Henry (Islington, N.)
MacMillan, Captain H.
Watson, Rt. Hon. W. (Carlisle)


Craig, Sir Ernest (Chester, Crewe)
Macnaghten, Hon. Sir Malcolm
Watts, Dr. T.


Croft, Brigadier-General Sir H.
McNeill, Rt. Hon. Ronald John
Wells, S. R.


Crooke, J. Smedley (Derltend)
Macquisten, F. A.
Wheler Major Sir Granville C. H.


Crookshank, Col. C. de W. (Berwick)
Maitland, Sir Arthur D. Steel-
White, Lieut.-Col. Sir G. Dalrymple


Dalkeith, Earl of
Makins, Brigadier-General E.
Williams, A. M. (Cornwall, Northern)


Davidson, Major-General Sir J. H.
Malone, Major P. B.
Williams, Com. C. (Devon, Torquay)


Davies, Sir Thomas (Cirencester)
Mason, Lieut-Col. Glyn K.
Williams, Herbert G. (Reading)


Davies, Dr. Vernon
Meller, R. J.
Wilson, R. R. (Stafford, Lichfield)


Davison, Sir W. H. (Kensington, S.)
Merriman, F. B.
Winby, Colonel L. P.


Dawson, Sir Philip
Meyer, Sir Frank
Windsor-Clive, Lieut.-Colonel George


Dean, Arthur Wellesley
Mitchell, S. (Lanark, Lanark)
Winterton, Rt. Hon. Earl


Dixon, Captain Rt. Hon. Herbert
Mitchell, W. Foot (Saffron Walden)
Wise, Sir Fredric


Edmondson, Major A. J.
Monsell, Eyres, Com. Rt. Hon. B. M
Wolmer, Viscount


Elliot, Major Walter E.
Moore, Sir Newton J.
Womersley, W. J.


Ellis, R. G.
Murchison, Sir Kenneth
Wood, E. (Chest'r, Stalyb'ge & Hyde)


Erskine, Lord (Somerset, Weston-s.-M.)
Nicholson, O. (Westminster)
Wragg, Herbert


Everard, W. Lindsay
Oakley, T.
Yerburgh, Major Robert D. T.


Fermoy, Lord
Penny, Frederick George
Young Rt. Hon. Sir Hilton (Norwich)


Finburgh, S.
Perkins, Colonel E. K.



Foxcroft, Captain C. T.
Perring, William George
TELLERS FOR THE AYES.—


Fraser, Captain Ian
Peto, G. (Somerset, Frome)
Captain Lord Stanley and Captain




Margesson.


NOES


Adamson, Rt. Hon. W. (Fife, West)
Groves, T.
Rose, Frank H.


Adamson, W. M. (Staff., Cannock)
Grundy, T. W.
Scrymgeour, E.


Alexander, A. V. (Sheffield, Hillsbro')
Hall, F. (York, W.R., Normanton)
Scurr, John


Ammon, Charles George
Hall, G. H. (Merthyr Tydvil)
Shepherd, Arthur Lewis


Baker, J. (Wolverhampton, Bliston)
Hardie, George D.
Shiels, Dr. Drummond


Baker, Walter
Harris, Percy A.
Short, Alfred (Wednesbury)


Barker, G. (Monmouth, Abertillery)
Hartshorn, Rt. Hon. Vernon
Smith, H. B. Lees (Keighley)


Barnes, A.
Hirst, G. H.
Smith, Rennie (Penistone)


Batey, Joseph
Hudson, J. H. (Huddersfield)
Snowden, Rt. Hon. Philip


Beckett, John (Gateshead)
Jenkins, W. (Glamorgan, Neath)
Spoor, Rt. Hon. Benjamin Charles


Broad, F. A.
John, William (Rhondda, West)
Stamford, T. W.


Bromley, J.
Jones, Morgan (Caerphilly)
Stephen, Campbell


Brown, Ernest (Leith)
Jones, T. I. Mardy (Pontypridd)
Stewart, J. (St. Rollox)


Brown, James (Ayr and Bute)
Kelly, W. T.
Strauss, E. A.


Buchanan, G.
Kennedy, T.
Sullivan, J.


Charleton, H. C.
Lawrence, Susan
Thorne, W. (West Ham, Plaistow)


Cluse, W. S.
Lawson, John James
Thurtle, Ernest


Connolly, M.
Lee, F.
Tinker, John Joseph


Crawfurd, H. E.
Lowth, T.
Walsh, Rt. Hon. Stephen


Dalton, Hugh
Lunn, William
Watson, W. M. (Dunfermline)


Day, Colonel Harry
MacLaren, Andrew
Watts-Morgan, Lt.-Col. D. (Rhondda)


Dennison, R.
MacNeill-Weir, L.
Wellock, Wilfred


Dunnico, H.
Morrison, R. C. (Tottenham, N.)
Welsh, J. C.


Edwards, J. Hugh (Accrington)
Mosley, Oswald
Williams, C. P. (Denbigh, Wrexham)


Evans, Capt. Ernest (Welsh Univer.)
Naylor, T. E.
Williams, David (Swansea, E.)


Fenby, T. D.
Oliver, George Harold
Williams, Dr. J. H. (Llanelly)


Forrest, W.
Palin, John Henry
Wilson, R. J. (Jarrow)


Gardner, J. P.
Pethick-Lawrence, F. W.
Windsor, Walter


Gillett, George M.
Potts, John S.
Wright, W.


Gosling, Harry
Rees, Sir Beddoe



Graham, D. M. (Lanark, Hamilton)
Riley, Ben
TELLERS FOR THE NOES.—


Greenall, T.
Ritson, J.
Mr. Charles Edwards and Mr.


Grenfell, D. R. (Glamorgan)
Robinson, W. C, (Yorks, W.R., Elland)
Whiteley.

Mr. E. BROWN: I beg to move, in page 5, line 8, to leave out the words, "suitable for use," and to insert instead thereof the words, "of a description commonly used."
I move this Amendment in a form which is slightly different from that appearing on the Paper.

Sir P. CUNLIFFE-LISTER: I am prepared to accept the Amendment.

Mr. BROWN: Then there is no need to argue the point. The Amendment is designed to leave out certain fancy articles which are only used in connection with breakfast sets and are not essential to the primary purpose of the report.

Amendment agreed to.

Mr. E. BROWN: I beg to move, in page 5, line 10, to leave out the words, "one pound and eight," and to insert instead thereof the word "fourteen."
The object of this Amendment is to lower the rate of duty from £1 8s. per cwt. to 14s. per cwt. and thereby to bring it nearer the application made to the Committee, which was for a duty approximating to 33⅓ per cent. This point was debated at great length on the first Amendment to this Clause and I think it is only treating the Committee fairly if I refrain from adding any facts and
figures to the arguments submitted previously.

Mr. LEES-SMITH: It may assist the Committee and expedite business if, instead of moving an Amendment standing in my name later on the Paper—to insert the words "or thirty-three and one-third per cent. of the value, whichever is the less "—which covers much the same point, I make at this stage any observations which we wish to make on this point. That will free the President of the Board of Trade from the objections to a particular form of argument which he expressed during the Debate on the main question. We wish to support the Amendment by certain figures which have been brought to our attention. We have had brought before us figures which indicate that when the Committee said that a duty of 28 shillings per cwt. was equivalent to an ad valorem duty of 33⅓ per cent., they had not sufficient evidence before them, and that, in fact, they laid down a duty higher than that which they had in mind in their statement about the equivalence of the specific and the ad valorem duty. I do not anticipate that this Amendment will be accepted, but I suggest that with the evidence which we have, and the evidence a part of which, at any rate, the right hon. Gentleman has, he should give us an undertaking to look into these figures again
and satisfy us on the Report stage that the intention of the committee of inquiry is being carried out. A duty of 33⅓ per cent. at the factory becomes equivalent to a duty of, say, 40 per cent. or thereabouts c.i.f. If this duty were merely equivalent to 40 per cent. or so, c.i.f., we should not be using the particular argument which we are using now; but our evidence is that this duty is going to work out on the average, on the main classes of pottery, at over 50 per cent.—nearer 60 per cent.—and in many cases at between 60 and 70 per cent.
The President was furnished with certain schedules in which it was argued that such would be the result. He has this afternoon quoted one single example taken from those schedules. Does he say that, taking all the schedules submitted to him, the average duty works out at33⅓ per cent.? If that be so, they contradict the figures in the annual returns of the Board of Trade. If we take those returns for any year in the last five years and divide the total weight of imports by the total value, we get a duty of nearer 50 than 40 per cent. But the figures in the Board of Trade returns include all classes of pottery. They include Copenhagen ware and rare Japanese pottery on which the average is much less than 33⅓ per cent. I think it has been said to go down to about 3 per cent. in some of these cases. That being so, it follows that on the main classes of pottery, to which the committee refer, and in connection with which they wish to secure an ad valorem duty of 33⅓ per cent., the average duty is nearer 50 per cent. In fact, the duty is far nearer to those figures which we have indicated as resulting from the evidence submitted to us. That is why we believe these figures have not been tested with sufficient accuracy. So far as we know, they were not tested at all by the committee of inquiry. There is no evidence of any figures on this subject having been submitted to them, and they do not say how they arrived at their conclusion. The inquiries have been simply those which have taken place subsequently at the Board of Trade, and we wish to ask the President whether he will repeat them and call for full information on this subject, and, if necessary, bring up revised terms on the Report stage.

Sir P. CUNLIFFE-LISTER: I do not want to go over the whole of the answer which I gave on the main Debate. The figures have been carefully considered; they were considered not only after the Report was presented but while the Committee were sitting. While it is true that in some cases the duty is considerably above 33⅓ per cent., in other cases it is considerably lower. That will always happen with a specific duty, and in this case the specific duty is much more convenient than an ad valorem duty. It is quite true that some of the figures submitted show a higher duty on some commodities. They were all based on factory cost, which, of course, is an entirely unsound basis on which to calculate the duty. The C.I.F. price would, I should think, add another 30% to the value. The illustration I quoted to the House was not quoted because it favoured my contention. I quoted it because it was an example given by the man who, I understand, asked to give evidence on behalf of the opponents in this case. Everybody naturally will produce the arguments which are most convenient to his own case, but I am checking this figure in this way. I have taken the figures of prices which were produced by the opponents, showing what are the costs of production and what are the prices at which the foreign articles are sold. The figures I gave included cups and saucers 4s. 2d. to 5s. 4½d., that means a duty varying from 36 per cent. to 28 per cent. I also included tea sets verying from 5s. to 6s. 9d.; that means a duty varying from 32½ per cent to 24 per cent. In the case of certain special Czechoslovakian ware, the duty works out at 34 per cent. There are certain to be variations one way or the other. Cases could be given showing the duty to be as low as 18 per cent. What we have got is a pretty good working average, and I must ask the Committee to adhere to the rate of duty.
I am much obliged to the hon. Member for Keighley (Mr. Lees-Smith) for raising his point on this Amendment, and so saving a debate on his further Amendment. I feel sure that his proposal to have an alternative duty, so that it would be possible to charge either a specific duty or an ad valorem duty, would be the most inconvenient course. This china comes in in consignments of varying
value, and the Customs officers would have to hold up each article to decide the weight or value, and consignments would have to be broken up in order that we could decide, in the case of each article in the consignment, whether the ad valorem or the specific duty was to be charged.

Mr. GILLETT: Our fundamental difficulties still remain, in spite of the speech of the right hon. Gentleman, because we have grave doubts about the assurances given by hon. Members opposite that this duty is not going to be thrown on the consumer, and the method of levying the duty according to the weight of the article is certainly going to throw the heaviest duty on the very goods which are used by the poorest people. Although that argument must be very familiar to the Minister, he has not in any way met it. I understand that the china and glassware section of the London Chamber of Commerce investigated the effect of the duty upon some typical goods imported, and they estimated that the duty would range as high as 60 per cent. or 70 per cent. The one exception worked out at 45 per cent., and in that case the goods were of a rather thinner make, showing that in the case of the more expensive goods the duty is lighter. Take the case of Longton china and a 21-piece tea-set sold at 13s. 2d., and compare that with a cheap china set which may be sold at 4s. 6d. Under the method by which this duty is being imposed, the cheap set, the set used by the poorer people, is the one that is penalised.
I have here one or two other illustrations which were brought to my notice. In the case of a tea-set valued at £10 4s. 2d., the duty worked out at £5 2s. In the case of some cups and saucers valued at £5 4s. 2d., the duty worked out at £5 10s. Because this ware was heavy stuff the duty amounted to more than the value of the goods themselves. An hon. Member speaking earlier in the Debate said British manufacturers had assured him they were not going to alter the price of their goods. That statement ignores one important point, because they have been telling us they are not selling their goods at the present time through being undercut by the cheaper foreign imports. It is obvious that, if they are going on selling, in spite of this duty, at the price at
which they are selling to-day, they are counting upon the duty preventing the cheaper stuff from coming in, and, although they may not alter their prices to the consumer, he would have his prices raised, because he would be compelled to buy the English ware at a higher price. There is a certain fallacy in the argument that the manufacturers are not going to alter their prices. Of course, they are not; there is no need for them to do so if foreign ware is to be prevented from coming in, because that will leave the market secure for the English maker; but it still leaves the fact that the consumer is going to bear the extra cost, or at any rate part of it. On these grounds we attach great importance to this question, and I very much regret that the Minister has not seen his way to meet us.

Mr. RILEY: Although there is force in what the Minister said with regard to the difficulty of adopting an ad valorem duty rather than a specific duty, that does not apply to a specific duty at a lower rate than is set forth in the Clause. The Minister, in his reply, has not met at all the substantial objection that, as the duty stands, it presses very heavily upon the people who are least in a position to bear it. We have also been told that, in spite of what the Minister has said, so far as regards the goods which have come in since the duty came into operation, the average duty has worked out at about 42 per cent. How the Minister justifies the statement that he makes it actually less, namely 34 or 35 per cent., I do not know.
It has been admitted in the Committee this afternoon that actual experience, since the duty began to operate, has shown that it averaged about 42 per cent. That indicates that the class of goods in use by the poorest people and in the greatest demand is the class of goods which is going to bear the largest proportion of this duty, while goods of better quality will have only a very small duty imposed upon them. The Minister has not met that substantial objection. It has not been denied that the vast bulk of the pottery which is imported and which comes under these duties is pottery of cheaper quality, and that, therefore, it will bear, under a specific duty, a higher and not a lower duty. That being the case, I submit that the Minister
should face the fact that the incidence of the duty as it now stands is not fair. I also submit, an an additional reason for accepting this Amendment, that clearly the Committee, when they were examining the request of the applicants, had before them the view that the duty as a whole would be 33⅓ per cent. They probably saw the difficulty of fixing an ad valorem duty, and they therefore

recommended a specific duty. It is known that a duty of 28s. per cwt. amounts to more than 33⅓ per cent., and I therefore urge the Minister to meet those who are moving this Amendment.

Question put, ''That the words 'one pound and eight' stand part of the Clause."

The Committee divided: Ayes, 225; Noes, 94.

Division No. 231.]
AYES.
[8. 52p. m.


Acland-Troyte, Lieut. -Colonel
Elliot, Major Walter E.
Macmillan, Captain H.


Alexander, Sir Wm. (Glasgow, Cent'l)
Ellis, R. G.
Macnaghten, Hon. Sir Malcolm


Applin, Colonel R. V. K.
Elveden, Viscount
McNeill, Rt. Hon. Ronald John


Ashley, Lt. -Col. Rt. Hon. Wilfrid W.
Erskine, Lord (Somerset, Weston-s.-M.)
Macquisten, F. A.


Astbury, Lieut-Commander F. W.
Evans, Captain A. (Cardiff, South)
Maitland Sir Arthur D. Steel-


Astor, Viscountess
Everard, W. Lindsay
Makins, Brigadier-General E.


Atkinson, C.
Falle, Sir Bertram G.
Malone, Major P. B.


Balfour, George (Hampstead)
Fermoy, Lord
Margesson, Captain D.


Barclay-Harvey, C. M.
Finburgh, S.
Meller, R. J.


Barnett, Major Sir Richard
Foxcroft, Captain C. T.
Merriman, F. B.


Barnston, Major Sir Harry
Fraser, Captain Ian
Meyer, Sir Frank


Benn, Sir A. S. (Plymouth, Drake)
Gates, Percy
Mitchell, S. (Lanark, Lanark)


Bennett, A. J.
Gault, Lieut. -Col. Andrew Hamilton
Mitchell, W. Foot (Saffron Walden)


Berry, Sir George
Gibbs, Col. Rt. Hon. George Abraham
Monsell, Eyres, Com. Rt. Hon. B. M.


Betterton, Henry B
Gilmour, Lt. -Col. Rt. Hon. Sir John
Moore, Sir Newton J.


Birchall, Major J. Dearrman
Grace, John
Murchison, Sir Kenneth


Bird, E. R. (Yorks, W. R., Skipton)
Graham, Fergus (Cumberland, N.)
Nicholson, O. (Westminster)


Boothby, R. J. G.
Greene, W. P. Crawford
Oakley, T.


Bourne, Captain Robert Croft
Greenwood, Rt.Hn.Sir H. (W'th's'w. E.)
Perkins, Colonel E. K


Bowater, Colonel Sir T. Vansittart
Grenfell, Edward C. (City of London)
Perring, Sir William George


Bowyer, Capt. G. E. W.
Grotrian, H. Brent
Peto, G. (Somerset, Frome)


Brassey, Sir Leonard
Gunston, Captain D. W.
Pilcher, G.


Briggs, J. Harold
Hacking, Captain Douglas H.
Pilditch, Sir Philip


Briscoe, Richard George
Hall, Lieut-Col. Sir F. (Dulwich)
Power, Sir John Cecil


Brocklebank, C. E. R.
Hall, Capt. W. D'A. (Brecon & Rad.)
Pownall Sir Assheton


Broun-Lindsay, Major H.
Hammersley, S. S.
Radford, E. A.


Brown, Brig. -Gen. H. C.(Berks, Newb'y)
Hannon, Patrick Joseph Henry
Raine, Sir Walter


Buckingham, Sir H.
Harland, A.
Ramsden, E.


Bullock, Captain M.
Harrison, G. J. C.
Rawson Sir Cooper


Burman, J. B.
Hartington, Marquess of
Reid, D. D. (County Down)


Burton, Colonel H. W.
Harvey, G. (Lambeth, Kennington)
Remer, J. R.


Butler, Sir Geoffrey
Hawke, John Anthony
Remnant, Sir James


Butt, Sir Alfred
Henderson, Capt. R. R. (Oxf'd, Henley)
Rice, Sir Frederick


Cadogan, Major Hon. Edward
Henderson, Lt. -Col. Sir V. L. (Bootle)
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Campbell, E. T
Heneage, Lieut. -Colonel Arthur P.
Roberts, Sir Samuel (Hereford)


Carver, Major W. H.
Hennessy, Major Sir G. R. J.
Ropner, Major L.


Cassels, J. D.
Herbert, Dennis (Hertford, Watford)
Russell, Alexander West (Tynemouth)


Cautley, Sir Henry S.
Hills, Major John Waller
Rye, F G.


Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Samuel, A. M. (Surrey, Farnham)


Cazalet, Captain Victor A.
Holt, Capt. H. P.
Samuel, Samuel (W'dsworth, Putney)


Chadwick, Sir Robert Burton
Hope, Capt. A. O. J. (Warw'k, Nun)
Sandeman, N. Stewart


Charteris, Brigadier-General J.
Hopkins, J. W. W.
Sanders, Sir Robert A.


Christie, J. A.
Howard-Bury, Lieut. -Colonel C. K.
Sanderson, Sir Frank


Churchill, Rt. Hon. Winston Spencer
Hudson, Capt. A. U. M. (Hackney, N.)
Sandon, Lord


Churchman, Sir Arthur C.
Hume, Sir G. H.
Sassoon, Sir Philip Albert Gustave D.


Clarry, Reginald George
Hunter-Weston, Lt. -Gen. Sir Aylmer
Savery, S. S.


Clayton, G. C.
Huntingfield, Lord
Shaw, Lt. -Col. A. D. Mcl. (Renfrew, W.)


Cobb, Sir Cyril
Hutchison, G. A. Clark (Midl'n & P'bl's)
Sheffield, Sir Berkeley


Cochrane, Commander Hon. A. D.
Illffe, Sir Edward M.
Shepperson, E. W.


Colman, N. C. D.
Jephcott, A. R.
Simms, Dr. John M. (Co. Down)


Conway, Sir W. Martin
Kidd, J. (Linllthgow)
Sinclair, Col. T. (Queen's Univ., Belfast)


Couper, J. B.
King, Commodore Henry Douglas
Skelton, A. N.


Cowan, Sir Wm. Henry (Islington. N.)
Lamb, J. Q.
Slaney, Major P. Kenyon


Craig, Sir Ernest (Chester, Crewe)
Lister, Cunliffe-, Rt. Hon. Sir Philip
Smith, R. W. (Aberd'n & Kinc'dine. C.)


Crooke, J. Smedley (Derltend)
Little, Dr. E. Graham
Smith-Carington, Neville W.


Crookshank, Col. C. de W. (Berwick)
Lloyd, Cyril E. (Dudley)
Smithers, Waldron


Dalkeith, Earl of
Loder, J. de V.
Somerville, A. A. (Windsor)


Davidson, MaJor-General Sir John H.
Looker, Herbert William
Sprot, Sir Alexander


Davies, Sir Thomas (Cirencester)
Lougher, Lewis
Stanley, Lieut. -Colonel Rt. Hon. G. F.


Davies, Dr. Vernon
Lucas-Tooth, Sir Hugh Vere
Stanley, Lord (Fylde)


Davison, Sir W. H. (Kensington, S.)
Luce, Major-Gen. Sir Richard Harman
Stanley, Hon. O. F. G. (Westm'eland)


Dawson, Sir Phillip
Lumiey, L. R.
Steel, Major Samuel Strang


Dean, Arthur Wellesley
Lynn, Sir R. J.
Streatfeild, Captain S. R.


Dixon, Captain Rt. Hon. Herbert
Macdonald, Capt. P. D. (I. of W.)
Styles, Captain H. W.


Edmondson, Major A. J.
Macdonald, R. (Glasgow, Cathcart)
Sugden, Sir Wilfrid


Sykes, Major-Gen. Sir Frederick H.
Watts, Dr. T.
Wise, Sir Fredric


Tasker, R. Inigo.
Wells, S. R.
Wolmer, Viscount


Thompson, Luke (Sunderland)
Wheler, Major Sir Granville C. H.
Womersley, W. J


Tinne, J. A.
White, Lieut.-Col. Sir G. Dalrymple
Wood, B. C. (Somerset, Bridgwater)


Tryon, Rt. Hon. George Clement
Williams, A. M. (Cornwall, Northern)
Wood, E. (Chest'r, Stalyb'ge & Hyde)


Wallace, Captain D. E.
Williams, Com. C. (Devon, Torquay)
Wragg, Herbert


Ward, Lt.-Col. A. L. (Kingston-on-Hull)
Williams, Herbert G. (Reading)
Yerburgh, Major Robert D. T.


Warner, Brigadier-General W. W.
Wilson, R. R. (Stafford, Lichfield)



Waterhouse, Captain Charles
Winby, Colonel L. P.
TELLERS FOR THE AYES.—


Watson, Sir F. (Pudsey and Otley)
Windsor-Clive, Lieut.-Colonel George
Mr. F. C. Thomson and Mr. fenny.


Watson, Rt, Hon. W. (Carlisle)
Winterton, Rt. Hon. Earl



NOES.


Adamson, Rt. Hon. W. (Fife, West)
Grundy, T. W.
Rose, Frank H.


Adamson, W. M. (Staff., Cannock)
Hall, F. (York, W. R., Normanton)
Scrymgeour, E.


Alexander, A. V. (Sheffield, Hillsbro')
Hall, G. H. (Merthyr Tydvil)
Scurr, John


Ammon, Charles George
Hardle, George D.
Shepherd, Arthur Lewis


Baker, J. (Wolverhampton, Bilston)
Hartshorn, Rt. Hon. Vernon
Shiels, Dr. Drummond


Baker, Walter
Hirst, G. H.
Short, Alfred (Wednesbury)


Barker, G. (Monmouth, Abertillery)
Hirst, W. (Bradford, South)
Smith, H. B. Lees (Keighley)


Barnes, A.
Hudson, J. H. (Huddersfield)
Smith, Rennie (Penistone)


Batey, Joseph
Jenkins, W. (Glamorgan, Neath)
Snowden, Rt. Hon. Philip


Beckett, John (Gateshead)
John, William (Rhondda, West)
Spoor, Rt. Hon. Benjamin Charles


Bromley, J.
Jones, Morgan(Caerphilly)
Stamford, T. W.


Brown, James (Ayr and Bute)
Jones, T. I. Mardy (Pontypridd)
Stephen, Campbell


Buchanan, G.
Kelly, W. T.
Stewart, J. (St. Rollox)


Charleton, H. C.
Kennedy, T.
Strauss, E. A.


Cluse, W. S.
Lawrence, Susan
Sullivan, J.


Connolly, M.
Lawson, John James
Thorne, W. (West Ham, Plaistow)


Crawfurd, H. E.
Lee, F.
Thurtle, Ernest


Dalton, Hugh
Lindley, F. W.
Tinker, John Joseph


Day, Colonel Harry
Lowth, T.
Walsh, Rt. Hon. Stephen


Dennison, R.
Lunn, William
Watson, W. M. (Dunfermline)


Dunnico, H.
MacLaren, Andrew
Watts-Morgan, Lt. -Col. D. (Rhondda)


Edwards', C (Monmouth, Bedwellty)
MacNeill-Weir, L.
Wellock, Wilfred


Edwards, J. Hugh (Accrington)
Morrison, R. C. (Tottenham, N.)
Welsh, J. C.


Evans, Capt. Ernest (Welsh Univer.)
Naylor, T. E.
Whiteley, W.


Forrest, W.
Oliver, George Harold
Williams, C. P. (Denbigh, Wrexham)


Gardner, J. P.
Palin, John Henry
Williams, David (Swansea, East)


Gillett, George M.
Pethick-Lawrence, F. W.
Williams, Dr. J. H. (Llanelly)


Gosling, Harry
Potts, John S.
Wilson, R. J. (Jarrow)


Graham, D. M. (Lanark, Hamilton)
Rees, Sir Beddoe
Windsor, Walter


Greenall, T.
Riley, Ben
Wright, W.


Grenfell, D. R. (Glamorgan)
Ritson, J.



Groves, T.
Robinson, W. C. (Yorks,W.R.,Elland)
TELLERS FOR THE NOES.—




Mr. Fenby andMr. Ernest Brown.

Mr. E. BROWN: I beg to move, in page 5, line 11, at the end, to add the words:
Provided that nothing in this Subsection shall apply to fireproof china.
The case of this Amendment is that when fireproof china, the word "fireproof" being used in a technical sense, was mentioned in the inquiry, it was said these articles were made in France and did not come under the scope of the inquiry. The Chairman did not invite evidence on the subject at all. Furthermore, none of the articles coming under the term "fireproof" were exhibited before the Committee, and a very great number of them do not come in competition at all with Longton ware, because similar articles are not made in England at all. We have put down this Amendment in the hope of saving cooking utensils and other pottery ware not normally used for table ware and getting them exempted from the duty. There is a great range of these articles which are not commonly used as table ware, and we
consider it is not fair, as they were not argued before the Committee and do not come into competition with Longton ware at all, that they should be subject, to the duty.

Sir P. CUNLIFFE-LISTER: While I cannot accept the Amendment, I do not really think that there is anything between the hon. Member and myself. Actually all china, as distinct from earthenware, is fireproof, and I am advised by the Customs authorities that if these words were put in they would have to exclude all the china that is subject to the duty. What the hon. Member wishes to exclude are those things that are not normally used for the service of food and drink, but only occasionally. The Customs practice is to exclude those, and they have issued an instruction making it plain that that kind of thing does not come within the scope of the duty. I have already accepted the hon. Member's Amendment
"of a description commonly used." That makes plainer what is already the practice.

Amendment, by leave, withdrawn.

The DEPUTY-CHAIRMAN (Captain FitzRoy): The next Amendment I select is the first standing in the name of the hon. Member for North Southwark—in page 5, line 11, at the end, to insert the words:
Provided that there shall be allowed and paid in the case of any manufactured article exported from Great Britain a drawback equal to the amount shown to the satisfaction of the Commissioners to have been paid as duty on the translucent or vitrified pottery used as a container.

Mr. STRAUSS: I should like first to move the next Amendment—in page 5, line 11, at the end, to insert the words:
Subject to the exclusion from the operation of this Section of all translucent, or vitrified pottery imported and used solely as containers for chocolate and sugar confectionery manufactured in the United Kingdom"—
as, if the Government give me that, it will not be necessary to move the other.

The DEPUTY-CHAIRMAN: I have my doubts about selecting the next Amendment at all.

Mr. STRAUSS: I beg to move, in page 5, line 11, at the end, to insert the words:
Provided that there shall be allowed and paid in the case of any manufactured article exported from Great Britain a drawback equal to the amount shown to the satisfaction of the Commissioners to have been paid as duty on the translucent or vitrified pottery used as a container.
This is simply to ask the Government to give a drawback on these cheap containers. I think that is a reasonable request, as the confectionery trade has

to meet very keen competition abroad, and if it is handicapped and has to pay the duty on the re-exported article it is placed in a very difficult position.

Sir P. CUNLIFFE-LISTER: While I cannot accept anything that is different in its terms from the regular drawback practice, I think the hon. Member already has all he wants under the Bill as it stands. There are imported into the Clause the provisions of the second Schedule of the Safeguarding of Industry (Customs Duty) Act, 1925. In that Schedule, in Sub-section (3) of Section 6 of the Finance Act, 1925, this is provided:
If it is proved to the satisfaction of the Commissioners that duty has been paid under this Section in respect of any goods, and that the goods have not been used in Great Britain or Northern Ireland, a drawback equal to the amount of the duty so paid shall be allowed on the goods if exported as merchandise
That covers the whole of the ordinary entrepoót trade, and I am advised by the Customs that in the case I understand the hon. Member referred to, of taking an article that is subject to this duty, like a teapot, and filling it with confectionery and then sending it out, it is the practice not to regard that as using the article, and it will already obtain the benefit of this Section. Therefore, while I could not agree to admitting any new principle of drawback, the point he is anxious about is, in fact, covered by the Customs practice under an existing Section of the Finance Act.

Amendment, by leave, withdrawn.

Motion made, and Question put, "That the Clause, as amended, stand part of the Bill."

The Committee divided: Ayes, 225; Noes, 95.

Clause 10 (Time for payment of beer duty) ordered to stand part of the Bill.

CLAUSE 11.—(Alteration of duties on cer- tain licences for mechanically-pro- pelled vehicles.)

Mr. CRAWFURD: I beg to move, in page 5, line 30, to leave out the word "and."
This Amendment and the next Amendment in my name—after "5" to insert "and 6"—are designed for one purpose, and I am perfectly sure they will have the keen sympathy not only of hon. Members on this side of the House whose sole interest in legislation, financial or otherwise, is justice, but also the sympathy of a number of Members on the opposite side of the Committee, and not least the Minister of Transport. The Amendment says, in effect, or it carries out to the logical conclusion this argument, if the Chancellor of the Exchequer is going to take—and I think "take" is the kindest word that has been used in this connection—for other purposes money which was raised specifically for the purpose of improving and the upkeep of the roads—and when I say money that was raised specifically for that purpose, I reassert what has been asserted and reasserted over and over again by Minister after Minister, both before and since the War—that that money should be used for the purpose of improving the transport communications of the country, and for no other purpose. I do not think that any hon. Members in any quarter of the Committee will really wish to penalise the motorists as such. They might wish to penalise the speedy motorist or the motorist who does not care for the convenience of other people, but motorists as such they will have no desire to penalise. While you raise taxation which was designed for a special purpose from a special class of people and do not apply the results of that taxation
for that special purpose, but take them for general purposes, you are imposing a special tax upon a special class, which seems to me a wrong system of finance. The Amendments to which I have alluded would have the effect of reducing the amount of money raised by motor taxation to the level which is required for the purposes for which that taxation was originally imposed, namely, for the upkeep and construction of roads. That is the principle underlying the tax—a perfectly simple and comprehensible principle, which is, I think, quite unanswerable.

The MINISTER of TRANSPORT (Colonel Ashley): The hon. Member has given us a dissertation upon the purposes to which the Road Fund should be devoted in a speech appropriate to Clause 46, but not appropriate at all to this Amendment, and he has told us nothing about the Amendment he seeks to move. The Amendment is simply to reduce by 25 per cent. the amount imposed on those who use what is called light cars, that is, ordinary motor cars. Of course, the answer, in a sentence, is that we cannot possibly accept the Amendment. The Amendment would diminish the amount paid into the Road Fund for these vehicles by 25 per cent. and would reduce the £6 which is paid for a motor car up to six horse-power from to £4 10s., and would impose a, duty of 15s. instead of £1 on each horse power over six. I need not weary the Committee by any further remarks, except to say that the Government cannot possibly accept the Amendment, because it would reduce the income of the Road Fund in this financial year by £2,500,000. The hon. Member has raised the general question of the raiding of the Road Fund, and I am personally in entire agreement with the action of the Chancellor. I think he had no other option than to do what he has done. From a Departmental point of
view, of course, one likes to have as much money as possible to spend in one's particular Department, but I am quite clear that the Chancellor of the Exchequer was absolutely right, and I entirely support him.

Lieut.-Colonel HOWARD-BURY: I have a great deal of sympathy with the Amendment moved by my hon. Friend. In 1920 the motor users were asked by the Chancellor of the Exchequer at that time if they would consent to a very heavy horse-power tax, and they agreed on condition that that money was applied to the benefit of the roads. He gave a definite promise in 1920 that when there was a surplus there would be a reduction of the tax upon motors. In the last two years the Chancellor of the Exchequer has taken no less than £27,000,000 from the Road Fund. That shows that there is a surplus, and that might very well be devoted to a reduction of taxation. I fully realise that the past year has been an unexampled year, and a year we hope the like of which will not happen again. But we do ask that in future, when there is a surplus in the Road Fund, this should be devoted to a reduction of the horse-power tax. We have always objected to this tax as being a most unfair type of tax that could be put on the motor car. By far the fairest type of tax is one on petrol. If you reduce the tax to 15s., you will reduce the amount of unfairness, and I would ask him seriously to consider, if he does not change to the tax on petrol, a reduction of the horse-power tax.
The tax on petrol is one that would bring in the same amount, in fact possibly more. If all the money that is devoted to the upkeep of roads is paid by the motorists, the more the motorist uses the roads, the more he should be taxed. At present the tax on horsepower does not do that. In 1924 there were 873,000 cars. The number has more than doubled since that time. The right hon. Gentleman who has just spoken has told us that this would act as a reduction of 23 per cent., but in 1920 he promised us that when there was a surplus of money it would be devoted to a reduction of tax. Private cars have increased since 1920 by two and a-half times, and I do ask him whether next year—I do not
ask him to do it this year, for I realise it is impossible—he cannot turn over to a tax on petrol, or think seriously of a reduction in the rate of the tax.

Mr. SNOWDEN: We are not willing to support this Amendment, because we are not in favour of any reduction in the yield of motor taxes. If this Amendment be carried, it will involve a very considerable reduction. I must express my admiration of the loyalty of the right hon. and gallant Gentleman to his colleagues, although I have to extend my admiration of his loyalty to his own Department. There was a point made in the speech of the hon. and gallant Member who has just sat down which is capable of misunderstanding. He said a pledge had been formerly given that if the yield of these motor taxes were in excess of that required for the needs for which they were levied, some reduction in the rate of tax would be made. The fact that there was the enormous sum of £27,000,000 does not mean that the needs of the roads have been exhausted, and that it was a surplus which could not possibly be devoted to the purpose for which the tax was originally imposed. As a matter of fact, the need for the expenditure of money on the roads has grown at a more rapid rate than the remarkable increase in the number of motor cars. I do not know whether the hon. and gallant Member's observations about a change in the basis of the tax from horse-power to a petrol tax, were in order or not, but I assume they were as the Chair did not call him to order. I hope the hon. and gallant Member will not assume that there is agreement in this House as to the desirability of such a change. After a considerable study of this question, all my convictions are that the present method of assessing on a combination which we call horse-power is definitely preferable to a tax on petrol. I will not go into that now, but some time in the future we shall have an opportunity of discussing it fully, and then I may be able to put to the House the reasons—I think substantial reasons—why the present method of basing the tax should be adhered to.

Question put, "That the word 'and' stand part of the Clause."

The Committee divided: Ayes, 209; Noes, 7.

Division No. 232.]
AYES.
[9.7 p.m.


Acland-Troyte, Lieut.-Colonel
Birchall, Major J. Dearman
Butler, Sir Geoffrey


Alexander, Sir Wm. (Glasgow, Cent'l)
Bird, E. R. (Yorks, W. R., Skipton)
Butt, Sir Alfred


Applin, Colonel R. V. K.
Boothby, R. J. G.
Cadogan, Major Hon. Edward


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Bourne, Captain Robert Croft
Campbell, E. T.


Astbury, Lieut.-Commander F. W.
Bowater, Col. Sir T. Vansittart
Carver, Major W. H.


Astor, Viscountess
Bowyer, Capt. G. E. W.
Cassels, J. D.


Atkinson, C.
Brassey, Sir Leonard
Cautley, Sir Henry S.


Baldwin, Rt. Hon. Stanley
Briggs, J. Harold
Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)


Balfour, George (Hampstead)
Briscoe, Richard George
Chadwick, Sir Robert Burton


Barclay-Harvey, C. M.
Brocklebank, C. E. R.
Chamberlain, Rt. Hon. N. (Ladywood)


Barnett, Major Sir Richard
Broun-Lindsay, Major H.
Charteris, Brigadier-General J.


Barnston, Major Sir Harry
Brown, Brig.-Gen.H.C.(Berks, Newb'y)
Christie, J. A.


Benn, Sir A. S. (Plymouth, Drake)
Buckingham, Sir H.
Churchill, Rt. Hon. Winston Spencer


Bennett, A. J.
Bullock, Captain M.
Churchman, Sir Arthur C.


Berry, Sir George
Burman, J. B.
Clarry, Reginald George


Betterton, Henry B.
Burton, Colonel H. W.
Clayton, G. C.


Cobb, Sir Cyril
Howard-Bury, Lieut.-Colonel C. K.
Rye, F. G.


Cochrane, Commander Hon. A. D.
Hudson, Capt. A. U. M. (Hackney, N. )
Samuel, Samuel (W'dsworth, Putney)


Colman, N. C. D.
Hume, Sir G. H.
Sandeman, N. Stewart


Conway, Sir W. Martin
Hunter-Weston, Lt.-Gen. Sir Aylmer
Sanders, Sir Robert A.


Couper, J. B.
Huntingfield, Lord
Sanderson, Sir Frank


Cowan, Sir Wm. Henry (Islington, N.)
Hutchison, G. A. Clark (Midl'n & P'bl's)
Sandon, Lord


Craig, Sir Ernest (Chester, Crewe)
Illfie, Sir Edward M.
Sassoon, Sir Philip Albert Gustave D.


Crooke, J. Smedley (Derltend)
Jephcott, A. R.
Savery, S. S.


Crookshank, Col. C. de W. (Berwick)
Kidd, J. (Linllthgow)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)


Dalkeith, Earl of
King, Commodore Henry Douglas
Sheffield, Sir Berkeley


Davidson, Major-General Sir John H.
Lamb, J. Q
Shepperson, E. W.


Davies, Sir Thomas (Cirencester)
Lister, Cunliffe, Rt. Hon. Sir Philip
Simms, Dr. John M. (Co. Down)


Davies, Dr. Vernon
Little, Dr. E. Graham
Sinclair, Col. T. (Queen's Univ., Belfst)


Davison, Sir W. H. (Kensington, S. )
Lloyd, Cyril E. (Dudley)
Skelton, A. N.


Dawson, Sir Philip
Loder, J. de V.
Slaney, Major P. Kenyon


Dean, Arthur Wellesley
Looker, Herbert William
Smith, R. W. (Aberd'n & Kinc'dlne, C.)


Dixon, Captain Rt. Hon. Herbert
Lougher, Lewis
Smith-Carington, Neville W.


Edmondson, Major A. J.
Lucas-Tooth, Sir Hugh Vere
Smithers, Waldron


Elliot, Major Walter E.
Luce, Major-Gen. Sir Richard Harman
Somerville, A. A. (Windsor)


Ellis, R. G.
Lumley, L. R.
Sprot, Sir Alexander


Elveden, Viscount
Lynn, Sir R. J.
Stanley, Lieut.-Colonel Rt. Hon. G. F.


Erskine, Lord (Somerset, Weston-s.-M.)
Macdonald, Capt. P. D. (l. of W.)
Stanley, Lord (Fylde)


Evans, Captain A. (Cardiff, South)
Macmillan, Captain H.
Stanley, Hon. O. F. G. (Westm'eland)


Everard, W. Lindsay
Macnaghten, Hon. Sir Malcolm
Steel, Major Samuel Strang


Falle, Sir Bertram G.
McNeill, Rt. Hon. Ronald John
Streafeild, Captain S. R.


Fermoy, Lord
Macquisten, F. A.
Styles, Captain H. Walter


Finburgh, S.
Maitland, Sir Arthur D. Steel
Sugden, Sir Wilfrid


Foxcroff Captain C. T.
Makins, Brigadier-General E.
Sykes, Major-Gen. Sir Frederick H.


Fraser, Captain Ian
Malone, Major P. B.
Tasker, R. Inigo.


Gates, Percy
Margesson, Capt. D.
Thompson, Luke (Sunderland)


Gault, Lieut.-Col. Andrew Hamilton
Mason, Lieut.-Colonel Glyn K.
Tinne, J. A.


Gibbs, Col. Rt. Hon. George Abraham
Melter, R. J.
Tryon, Rt. Hon. George Clement


Gilmour, Colonel Rt. Hon. Sir John
Merriman, F. B.
Wallace, Captain D. E.


Glyn, Major R. G. C.
Meyer, Sir Frank
Ward, Lt.-Col. A. L. (Kingston-on-Hull)


Grace, John
Mitchell, S. (Lanark, Lanark)
Warner, Brigadier-General W. W.


Graham, Fergus (Cumberland, N.)
Mitchell, W. Foot (Saffron Walden)
Waterhouse, Captain Charles


Greene, W. P. Crawford
Monsell, Eyres, Com. Rt. Hon. B. M
Watson, Sir F. (Pudsey and Otley)


Greenwood, Rt.Hn.SirH. (W'th'sw,E)
Moore, Sir Newton J.
Watson, Rt. Hon. W. (Carlisle)


Grotrian, H. Brent
Murchison, Sir Kenneth
Watts, Dr. T.


Gunston, Captain D. W.
Nicholson, O. (Westminster)
Wells, S. R.


Hacking, Captain Douglas H.
Oakley, T.
Wheler, Major Sir Granville C. H.


Hall, Lieut.-Col. Sir F. (Dulwich)
Perkins, Colonel E. K.
White, Lieut.-Col. Sir G. Dairymple-


Hall, Capt. W. D'A. (Brecon & Rad.)
Perring, Sir William George
Williams, A. M. (Cornwall, Northern)


Hammersley, S. S.
Peto, G. (Somerset, Frome)
Williams, Com. C. (Devon, Torquay)


Hannon, Patrick Joseph Henry
Pilcher, G.
Williams, Herbert G. (Reading)


Harland, A.
Pilditch, Sir Philip
Wilson, R. R. (Stafford, Lichfield)


Harrison, G. J. C.
Power, Sir John Cecil
Winby, Colonel L. P.


Harlington, Marquess of
Pownall, Sir Assheton
Windsor-Clive, Lieut.-Colonel George


Harvey, G. (Lambeth, Kennington)
Radford, E. A.
Winterton, Rt. Hon. Earl


Hawke, John Anthony
Raine, Sir Walter
Wise, Sir Fredric


Henderson, Capt. R. R. (Oxf'd, Henley)
Ramsden, E.
Wolmer, Viscount


Henderson, Lt.-Col. Sir V. L. (Bootle)
Rawson, Sir Cooper
Womersley, W. J.


Heneage, Lieut.-Colonel Arthur P.
Reid, D. D. (County Down)
Wood, B. C. (Somerset, Bridgwater)


Hennessy, Major J. R. G.
Remer, J. R.
Wood, E. (Chest'r, Stalyb'dge & Hyde)


Herbert, Dennis (Hertford, Watford)
Remnant, Sir James
Wragg, Herbert


Hlils, Major John Waller
Rice, Sir Frederick
Yerburgh, Major Robert D. T.


Hogg, Rt.Hon.SirD.(St. Marylebone)
Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Young, Rt. Hon. Sir Hilton (Norwich)


Holt, Captain H. P.
Roberts, Sir Samuel (Hereford)



Hope, Capt. A. O. J. (Warw'k. Nun.)
Ropner, Major L.
TELLERS FOR THE AYES.—


Hopkins, J. W. W.
Russell, Alexander West (Tynemouth)
Mr. F. C. Thomson and Mr. Penny.


NOES.


Adamson, Rt. Hon. W. (Fife, West)
Dennison, R.
Jenkins, W. (Glamorgan, Neath)


Adamson, W. M. (Staff., Cannock)
Dunnco, H.
John, William (Rhondda, West)


Alexander, Sir Wm. (Glasgow, Cent'l)
Evans, Capt. Ernest (Welsh Univer.)
Jones, Morgan (Caerphilly)


Ammon, Charles George
Fenby, T. D.
Jones, T. I. Mardy (Pontypridd)


Baker, J. (Wolverhampton, Bilston)
Forrest, W.
Kelly, W. T.


Baker, Walter
Gardner, J. P.
Kennedy, T.


Barker, G. (Monmouth, Abertillery)
Gillett, George M.
Lawrence, Susan


Barnes, A.
Gosling, Harry
Lawson, John James


Batey, Joseph
Graham, D. M. (Lanark, Hamilton)
Lee, F.


Beckett, John (Gateshead)
Greenall, T.
Lindley, F. W.


Broad, F. A.
Greenwood, A. (Nelson and Colne)
Lowth, T.


Bromley, J.
Grentell, D. R. (Glamorgan)
Lunn, William


Brown, Ernest (Leith)
Groves, T.
MacLaren, Andrew


Brown, James (Ayr and Bute)
Grundy, T. W.
MacNeill-Weir, L.


Buchanan, G.
Hall, F. (York, W. R., Normanton)
Morrison, R. C. (Tottenham N.)


Charleton, H. C.
Hall, G. H. (Merthyr Tydvil)
Naylor, T. E.


Cluse, W. S.
Hardle, George D.
Oliver, George Harold


Connolly, M.
Hartshorn, Rt. Hon. Vernon
Palin, John Henry


Crawfurd, H. E.
Hirst, G. H.
Parkinson, John Allen (Wigan)


Dalton, Hugh
Hirst, W. (Bradford, South)
Pethick-Lawrence, F. W.


Day, Colonel Harry
Hudson, J. H. (Huddersfield)
Potts, John S.




Rees, Sir Beddoe
Snowden, Rt. Hon. Philip
Wellock, Wilfred


Riley, Ben
Stamford, T. W.
Welsh, J. C.


Ritson, J.
Stephen, Campbell
Williams, C. P. (Denbigh, Wrexham)


Robinson, W. C. (Yorks, W. R., Elland)
Stewart, J. (St. Rollox)
Williams, David (Swansea, East)


Rose, Frank H.
Strauss, E. A.
Williams, Dr. J. H. (Llanelly)


Scrymgeour, E.
Sullivan, J.
Wilson, R. J. (Jarrow)


Scurr, John
Thorne, W. (West Ham, Plaistow)
Windsor, Walter


Shepherd, Arthur Lewis
Thurtle, Ernest
Wright, W.


Shiels, Dr. Drummond
Tinker, John Joseph



Short, Alfred (Wednesbury)
Walsh, Rt. Hon. Stephen
TELLERS FOR THE NOES.—


Smith, H. B. Lees- (Keighley)
Watson, W. M. (Dunfermline)
Mr. Charles Edwards and Mr. W.


Smith, Rennie (Penistone)
Watts-Morgan, Lt.-Col. D. (Rhondda)
Whiteley.

[Division No. 233.]
AYES.
[9.28 p.m.


Acland-Troyte, Lieut.-Colonel
Forrest, W.
Peto, G. (Somerset, Frome)


Alexander, E. E. (Leyton)
Foxcroft, Captain C. T.
Pilditch, Sir Philip


Alexander, Sir Wm. (Glasgow, Cent'l)
Fraser, Captain Ian
Power, Sir John Cecil


A[...]lin, Colonel R. V. K.
Gates, Percy
Pownall, Sir Assheton


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Gault, Lieut.-Col. Andrew Hamilton
Raine, Sir Walter


Astbury, Lieut.-Commander F. W.
Gibbs, Col. Rt. Hon. George Abraham
Ramsden, E.


Atkinson, C.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Rawson, Sir Cooper


Balfour, George (Hampstead)
Glyn, Major R. G. C.
Rees, Sir Beddoe


Barclay-Harvey, C. M.
Gower, Sir Robert
Reid, D. D. (County Down)


Barnston, Major Sir Harry
Grace, John
Remer, J. R.


Benn, Sir A. S. (Plymouth, Drake)
Graham, Fergus (Cumberland, N.)
Remnant, Sir James


Bennett, A. J.
Greene, W. P. Crawford
Rice, Sir Frederick


Berry, Sir George
Greenwood, Rt. Hn. Sir H. (W'th's'w, E)
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Betterton, Henry B.
Hacking, Captain Douglas H.
Roberts, Sir Samuel (Hereford)


Birchall, Major J. Dearman
Hammersley, S. S.
Ropner, Major L.


Boothby, R. J. G.
Hannon, Patrick Joseph Henry
Russell, Alexander West (Tynemouth)


Bourne, Captain Robert Croft
Harland, A.
Rye, F. G.


Bowyer, Capt. G. E. W.
Harrison, G. J. C.
Sandeman, N. Stewart


Brassey, Sir Leonard
Hartington, Marquess of
Sanders, Sir Robert A.


Briggs, J. Harold
Harvey, G. (Lambeth, Kennington)
Sanderson, Sir Frank


Briscoe, Richard George
Hawke, John Anthony
Sassoon, Sir Philip Albert Gustave D.


Brocklebank, C. E. R.
Henderson, Capt. R. R. (Oxf'd, Henley)
Savery, S. S.


Broun-Lindsay, Major H.
Henderson, Lt.-Col. Sir V. L. (Bootle)
Sheffield, Sir Berkeley


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Heneage, Lieut.-Colonel Arthur P.
Shepperson, E. W.


Buckingham, Sir H.
Hennessy, Major Sir G. R. J.
Simms, Dr. John M. (Co. Down)


Bullock, Captain M.
Herbert, Dennis (Hertford, Watford)
Sinclair, Col. T. (Queen's Univ., Belfast)


Burman, J. B.
Hills, Major John Wal[...]
Slaney, Major P. Kenyon


Burton, Colonel H. W.
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Smith, R. W. (Aberd'n & Kinc'dine. C.)


Butler, Sir Geoffrey
Hope, Capt. A. O. J. (Warwk, Nun.)
Smith-Carington, Neville W.


Butt, Sir Alfred
Hudson, Capt, A. U. M. (Hackney, N.)
Somervilie, A. A. (Windsor)


Cadogan, Major Hon. Edward
Hume, Sir G. H.
Sprot, Sir Alexander


Campbell, E. T.
Hunter-Weston, Lt.-Gen. Sir Aylmer
Stanley, Lieut.-Colonel Rt. Hon. G. F.


Carver, Major W. H.
Huntingfield, Lord
Stanley, Lord (Fylde)


Cassels, J. D.
Hutchison, G. A. Clark (Midl'n & P'bl's)
Stanley, Hon. O. F. G. (Westm'eland)


Cautley, Sir Henry S.
Illffe, Sir Edward M.
Steel, Major Samuel Strang


Cayzer, MaJ. Sir Herbt. R. (Prtsmth.S.)
Jephcott, A. R.
Streatfeild, Captain S. R.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Kidd, J. (Linllthgow)
Styles, Captain H. W.


Chadwick, Sir Robert Burton
King Commodore Henry Douglas
Sueter, Rear-Admiral Murray Fraser


Charteris, Brigadier-General J.
Lamb, J. Q.
Sugden, Sir Wilfrid


Christie, J. A.
Lister, Cunliffe, Rt. Hon. Sir Philip
Sykes, Major-Gen. Sir Frederick H.


Churchill, Rt. Hon. Winston Spencer
Little, Dr. E. Graham
Tasker, R. Inigo.


Churchman, Sir Arthur C.
Lloyd, Cyril E. (Dudley)
Thompson, Luke (Sunderland)


Clarry, Reginald George
Looker, Herbert William
Tinne, J. A.


Clayton, G. C.
Lougher, Lewis
Tryon, Rt. Hon. George Clement


Cobb, Sir Cyril
Lucas-Tooth, Sir Hugh Vere
Wallace, Captain D. E.


Colman, N. C. D.
Luce MaJ.-Gen. Sir Richard Harman
Ward, Lt.-Col. A. L. (Kingston-on-Hull)


Conway, Sir W. Martin
Lumley, L. R
Warner, Brigadier-General W.


Couper, J. B.
Lynn, Sir R. J.
Watson, Sir F. (Pudsey and Otley)


Cowan, Sir Wm. Henry (Islington, N.)
MacMillan, Captain H.
Watson, Rt. Hon. W. (Carlisle)


Craig, Sir Ernest (Chester, Crewe)
Macnaghten, Hon. Sir Malcolm
Watts, Dr. T.


Crooke, J. Smedley (Derltend)
McNeill, Rt. Hon. Ronald John
Wells, S. R.


Crookshank, Col. C. de W. (Berwick)
Macquisten, F. A.
Wheler, Major Sir Granville C. H.


Crookshank, Cpt. H. (Lindsey, Gainsbro)
Maitland, Sir Arthur D. Steel
White, Lieut.-Col. Sir G. Dalrymple


Dalkeith, Earl of
Malone, Major P. B.
Williams, A. M. (Cornwall, Northern)


Davidson, Major-General Sir John H.
Margesson, Captain D.
Williams, Com. C. (Devon, Torquay)


Davies, Sir Thomas (Cirencester)
Marriott, Sir J. A. R.
Williams, Herbert G. (Reading)


Davies, Dr. Vernon
Mason, Lieut.-Col. Glyn K.
Wilson, R. R. (Stafford, Lichfield)


Davison, Sir W. H. (Kensington, S.)
Meller, R. J.
Windsor-Clive, Lieut.-Colonel George


Dawson, Sir Philip
Merriman, F. B.
Winterton, Rt. Hon. Earl


Dean, Arthur Wellesley
Meyer Sir Frank
Wise, Sir Fredric


Dixon, Captain Rt. Hon. Herbert
Mitchell, S. (Lanark, Lanark)
Wolmer, Viscount


Edmondson, Major A. J.
Mitchell, W. Foot (Saffron Walden)
Womersley, W. J.


Elliot, Major Walter E.
Monsell, Eyres, Com. Rt. Hon. B. M.
Wood, B. C. (Somerset, Bridgwater)


Ellis, R. G.
Moore, Sir Newton J.
Wood, E. (Chest'r, Stalyb'dge & Hyde)


Elveden, Viscount
Murchison, Sir Kenneth
Wragg, Herbert


Erskine, Lord (Somerset, Weston-s.-M.)
Nelson, Sir Frank
Yerburgh, Major Robert D. T.


Evans, Captain A. (Cardiff, South)
Nicholson, O. (Westminster)
Young, Rt. Hon. Sir Hilton (Norwich)


Everard, W. Lindsay
Oakley, T.



Falle, Sir Bertram G.
Pennefather, Sir John
TELLERS FOR THE AYES.—


Fermoy, Lord
Perkins, Colonel E, K.
Mr. F. C. Thomson and Mr. Penny.


Finburgh, S.
Perring, Sir William George





NOES.


Briant, Frank
Groves, T.
Williams. C. P. (Denbigh, Wrexham)


Brown, Ernest (Leith)
Scrymgeour, E.



Evans, Capt. Ernest (Welsh Univer.)
Watson, W. M (Dunfermline)
TELLERS FOR THE NOES.—




Mr. Crawfurd and Mr. Fenby.

Lieut.-Colonel HOWARD-BURY: I beg to move in page 5, line 32, at the end, to insert the words:
and as if the duties specified in the said paragraph (5), as amended by the Finance Act, 1926, were further amended in respect of the duties of excise on vehicles adapted for the conveyance of goods by the substitution of the rates of duties for such vehicles set out in the Fourth Schedule to this Act for the rates for such vehicles set out in the First Schedule to the Finance Act, 1926.
This Amendment must be taken in conjunction with the Amendment to the Fourth Schedule later on the Order Paper. The effect of the Amendment is to grade commercial cars for taxation purposes. Last year a new tax was imposed upon commercial cars and the grading was very steep. Over one ton and up to two tons there was a sudden rise of £10 in the tax. Over two tons and up to three tons there was a rise in the tax of £14. The grievance of the manufacturers is that they were not consulted and that they had been consulted, without doing away with the maximum tax, they would have suggested a tax which included smaller steps. Private cars are taxed on horsepower, the tax being £1 per horse-power, but on commercial cars the tax is by tons, and there is a very big rise in the steps. The effect of the Amendment is to put in intervening steps of five cwt., so that the tax instead of rising by £10 or £14 as at present would rise by steps of £3 or £4.
The manufacturers have found that the effect of the present tax is to limit design. When there is a sudden increase in the tax, as at present, the effect is that if a commercial car weighs a few pounds over one ton, it means an additional tax of £10 a year. Putting a limit on design has an effect on our export trade. To increase the efficiency of a car it may be necessary to have an electric lighting set, or a self-starter, or four-wheel brakes; but the effect of these improvements may be to increase the weight of the car to a few pounds above one ton, or to a few pounds over two tons, and that would mean an increase of £10 or £14 a year in tax. I do not think that the effect of this Amendment would be very appreciable on the amount of revenue that comes in, because the greater number of the cars
to-day are within five cwts. of those limits. Such being the case, and when nearly half the number of commercial cars are under one ton, and the greater part of these within five cwts. of that ton, if we had this regrading it would not affect the tax yield to any great extent, but it might in certain cases improve it. By adding improvements to a car, you might make the weight slightly above one ton, in which case, under the scheme which I propose, there would be only a £3 extra tax on the car, whereas at the present time manufacturers are often prevented from putting in those improvements, because the added weight might mean the addition of a £10 tax.
As the yearly rate of increase in commercial cars is about 20,000, it means at the minimum an increase of over £300,000 a year. The effect of this proposed tax would be practically stationary, because instead of having an increase of, say, £300,000 or £400,000 a year, for the next year it would be stationary, and after that it would increase. I do not think the Chancellor of the Exchequer can put this scheme into operation this year, but I do ask him seriously to consider whether next year it would not be advisable to have this regrading of commercial motor cars, in consultation with the manufacturers, keeping the maximum amounts as they are at present, but having smaller steps so as to encourage our export trade. At the present time the manufacturers are compelled to make two kinds of cars, one for the home trade, and another for the Colonial trade. That can only mean that there is an increase in production costs, whereas if they had one model both for the home trade and the export trade they could sell the cars at a cheaper rate abroad. That is a most important point, and I would ask my right hon. Friend seriously to consider it. It will mean practically no difference in the revenue, but it is a matter of great concern to our manufacturers in this country. I would ask him if next year he would seriously consider this proposal before the Budget is framed.

Colonel ASHLEY: I have two objections to my hon. and gallant Friend's proposal, one a minor and one a major objection. The minor objection is that the more steps you have, the more administrative expense there must be in
carrying out the operation of the tax. Although that is not an insuperable difficulty, one can well understand that those who have to carry out a tax desire to carry it out as economically as possible.

Lieut.-Colonel HOWARD-BURY: Have you not steps in horse power?

Colonel ASHLEY: We want as few steps as possible, from the administrative point of view.

Lieut.-Colonel HOWARD-BURY: You have them now in horse power.

Colonel ASHLEY: It is very simple to deal with one horse, two-horse power or three-horse power.

Lieut.-Colonel HOWARD-BURY: The steps which I propose are steps of five cwt.

Colonel ASHLEY: My major objection is that I am advised that this Schedule would cost the Road Fund certainly £500,000 a year, and probably £600,000. The Committee must realise that with the increasing demands made upon the Road Fund, and when hon. Members representing rural constituencies are asking for further help for rural roads, it is impossible to give away half a million a year. As my hon. and gallant Friend has asked me, I will look personally into the matter between now and next year, and see whether anything can be done to deal with the matter. I am sure he will not expect me to say more now.

The DEPUTY-CHAIRMAN: Does the hon. and gallant Member press the Amendment?

Lieut.-Colonel HOWARD-BURY: No, Sir.

Amendment, by leave, withdrawn.

Mr. SCURR: I beg to more in page 5, line 32, at the end, to add the words:
Provided that a rebate of twenty-five per cent, of the licence duty payable in respect of a vehicle exceeding two tons in weight unladen under the said paragraph (5) shall be allowed in respect of every such vehicle fitted with pneumatic tyres.
The object of this Amendment, which stands in the name of my hon. Friend the Member for Rotherhithe (Mr. B. Smith) is to encourage the use of pneumatic
tyres on heavy vehicles by giving a 25 per cent. rebate on licence duties payable under paragraph 5 of the Schedule to which reference is made in Clause 11. The effect of Clause 11 as it stands is to provide a reduced rate of duty for certain classes of vehicles. We desire to extend that for the purpose of encouraging heavy grade vehicles which have solid tyres at the present time to resort to pneumatic tyres. The result of that would be a considerable saving in the expenses which fall on the Road Fund, because a considerable amount of traffic is done by heavy vehicles with solid tyres, not only when they are new, but more particularly as they get old, and when the tyres are damaged. Consequently, they damage the road much more. I think the right hon. Gentleman has sympathy with this Amendment, and I hope his sympathy will be demonstrated by his acceptance of it. At the present time at least 95 per cent. of the heavy trade vehicles have solid tyres. We estimate, after careful investigation by the Transport Workers' Union, that the effects of this Amendment if adopted will be to double at least the number of vehicles that will use pneumatic tyres, and we anticipate that the cost to the revenue of the whole thing would be £62,000, but we maintain that the saving would be greater than that, On account of the expenditure saved on repairing the roads.

Colonel ASHLEY: Last year an Amendment was proposed on the same lines as that which has been moved by the hon. Member, and it was rejected by the House. We cannot accept this Amendment, because of the cost to the Road Fund. But though we cannot accept the Amendment, I would point out that the saving to the roads is not quite as great as the hon. Member imagines. It is quite true that the pneumatic tyre does less damage to the roads than the solid tyre, but on the other hand, the pneumatic tyre travels at a greater speed than the solid tyre, and, therefore, greater mileage of road is involved. The difference in the damage done by these two classes of tyres, though it is substantial, is not as great as the hon. Member seems to think. Then there are administrative difficulties. The acceptance of the Amendment would result in adding considerably to the duty to be
carried out by the police authorities. As the Committee has heard, complaints are constantly coming to the Home Office that the police are being asked to perform a number of duties outside their normal functions, and it is really undesirable, if not impossible, to ask them to undertake any further work, because every piece of extra work you give them to do hampers the discharge of their ordinary duty. I must, therefore, resist the Amendment.

Mr. PALIN: I join issue with the right hon. Gentleman when he says that under this Amendment no saving would be effected.

Colonel ASHLEY: I did not say that. What I said was that the saving is not as great as some people imagine.

Mr. PALIN: It is very much greater than the Minister realises, and if the Road Fund is for the purpose of maintaining the roads in proper condition and making them safe for ordinary people, it should be so used. In my own town the other night the roads were crowded, and there were three deaths and a number of people injured owing to the road in certain parts being too narrow. If the roads are dangerous to human life owing to their dangerous condition, surely it is quite a proper thing to get rid of the danger to ordinary people by widening the roads. Prevention is very much better than cure, and the extra cost to the Road Fund would be well spent. The great damage that is done to the paved roads in our cities does not fall on the Road Fund, but, unfortunately for the local authorities in the smaller towns, it falls upon the tramways or on the rates of the principal town. It does seem to me that the Minister does not appear to have any conviction on any particular point in regard to this matter, because otherwise his own conscience would make him feel the reasonableness of the Amendment which has been moved by my hon. Friend.

Miss WILKINSON: There are two problems and two different kinds of roads. One is the problem of the tar-macadamised roads where you get heavy vehicles with solid tyres doing great injury in warm weather and making the roads corrugated. This is frightfully bad for the
roads. The second kind of road is the road where the surface is not tarmac, and it is extraordinarily difficult to get the country to take up this question of this kind of road and to press that such roads should be kept in decent condition. These roads have an ordinary metal surface, and on a wet day these heavy, overladen, solid-tyre lorries simply ruin this kind of road. Two or three of these lorries are almost sufficient to ruin the road. I, myself, have seen a road of this kind simply torn up in wet weather by these heavily laden vehicles with solid tyres, and put into such a condition that it was not fit to be used. It is entirely false economy not to agree to a duty which would pay for itself over and over again. There is a great deal of trouble in getting the county authorities to come along and improve these roads. It is all very well to talk about the claims of the Road Fund, but the right hon. Gentleman had better tell that to the Chancellor of the Exchequer. Even if he does want to save the Road Fund, it is not unreasonable to accept this sensible suggestion.

Mr. R. MORRISON: There is one thing that has not been mentioned in this discussion, but I do not think even if it were the Government would take any notice of it. It is the amount of damage that is being done every day by these heavy solid tyre vehicles not only to the roads but to residential property. Every Member of this House has at some time or other received a communication from the National Citizens' Union and other Bolshevist organisations of that kind begging them to raise this question of the damage done by these heavy vehicles to residential property. I apologise for having mentioned this matter, because I am sure no member of the Government takes the slightest interest in the question of damage to residential property.

Mr. E. BROWN: I agree with the protest that has been made against the continual damage to the roads by these heavy solid tyre vehicles. We are continually getting resolutions sent to us about the damage done where there is a great deal of heavy traffic of this kind. If you travel between Rugby and Northampton, for instance, you will see how the tarmac road is damaged in hot weather by these solid tyre vehicles. I,
therefore, support the protest that has been made. If, on the other hand, you leave that town and come south along the road which is partly tarmac and partly ordinary material you will see that the solid tyres cut the road about in hot

weather very heavily indeed. This is a very sensible Amendment

Question put, "That those words be there added."

The Committee divided: Ayes, 97; Noes, 240

Division No. 234.]
AYES.
[9.57 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Greenwood, A. (Nelson and Colne)
Robinson, W. C. (Yorks, W. R., Elland)


Adamson, W. M. (Staff., Cannock)
Grenfell, D. R. (Glamorgan)
Rose, Frank H.


Alexander, A. V. (Sheffield, Hillsbro')
Groves, T.
Scrymgeour, E


Ammon, Charles George
Grundy, T. W.
Scurr, John


Baker, J. (Wolverhampton, Bilston)
Hall, F. (York, W. R., Normanton)
Shepherd, Arthur Lewis


Baker, Walter
Hall, G. H. (Merthyr Tydvil)
Shiels, Dr. Drummond


Barker, G. (Monmouth, Abertillery)
Hardle, George D.
Short, Alfred (Wednesbury)


Barnes, A.
Hartshorn, Rt. Hon. Vernon
Smith, H. B. Lees-(Keighley)


Batey, Joseph
Hirst, G. H.
Smith, Rennie (Penistone)


Beckett, John (Gateshead)
Hirst, W. (Bradford, South)
Snowden, Rt. Hon. Philip


Bowerman, Rt. Hon. Charles W.
Hudson, J. H. (Huddersfield)
Spoor, Rt. Hon. Benjamin Charles


Briant, Frank
Jenkins, W. (Glamorgan, Neath)
Stamford, T. W.


Broad, F. A.
John, William (Rhondda, West)
Stephen, Campbell


Bromley, J.
Jones, Morgan (Caerphilly)
Stewart, J. (St. Rollox)


Brown, Ernest (Leith)
Jones, T. I. Mardy (Pontypridd)
Strauss, E. A.


Brown, James (Ayr and Bute)
Kelly, W. T.
Thorne, W (West Ham, Plaistow)


Buchanan, G.
Kennedy, T.
Thurtle, Ernest


Buxton, Rt. Hon. Noel
Lawrence, Susan
Tinker, John Joseph


Charleton, H. C.
Lawson, John James
Walsh, Rt. Hon. Stephen


Cluse, W. S.
Lee, F.
Watts-Morran, Lt.-Col. D. (Rhondda)


Compton, Joseph
Lindley, F. W.
Wellock, Wilfred


Connolly, M.
Lowth, T.
Welsh, J. C.


Crawfurd, H. E.
Lunn, William
Whiteley, W.


Dalton, Hugh
MacLaren, Andrew
Wilkinson, Ellen C.


Day, Colonel Harry
MacNeill-Weir, L,
Williams, C. P. (Denbigh, Wrexham)


Dennison, R.
Morrison, R. C. (Tottenham, N.)
Williams, David (Swansea, East)


Dunnico, H.
Naylor, T. E.
Williams, Dr. J. H. (Llanelly)


Evans, Capt. Ernest (Welsh Univer.)
Oliver, George Harold
Wilson, R. J. (Jarrow)


Fenby, T. D.
Palin, John Henry
Windsor, Walter


Gardner, J. P.
Pethick-Lawrence, F. W.



Gillett, George M.
Potts, John S.
TELLERS FOR THE AYES.—


Gosling, Harry
Rlley, Ben
Mr. Charles Edwards and Mr. Allen


Graham, D. M. (Lanark, Hamilton)
Ritson, J.
Parkinson.


Greenall, T.
Robinson, Sir T. (Lancs, Stretford)



NOES.


Acland-Troyte, Lieut.-Colonel
Butt, Sir Alfred
Dean, Arthur Wellesley


Alexander, E. E. (Leyton)
Cadogan, Major Hon. Edward
Dixon, Captain Rt. Hon. Herbert


Alexander, Sir Wm. (Glasgow, Cent'l)
Campbell, E. T.
Eden, Captain Anthony


Applin, Colonel R. V. K.
Carver, Major W. H.
Edmondson, Major A. J.


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Cassels, J. D.
Elliot, Major Walter E.


Astbury, Lieut.-Commander F. W.
Cautley, Sir Henry S.
Ellis, R. G.


Astor, Viscountess
Cayzer, Maj. Sir Herbt.R.(Prtsmth. S.)
Elveden, Viscount


Atkinson, C.
Cecil, Rt. Hon. Sir Evelyn (Aston)
Erskine, Lord (Somerset, Weston-s.-M. )


Baldwin, Rt. Hon. Stanley
Chadwick, Sir Robert Burton
Evans, Captian A. (Cardiff, South)


Balfour, George (Hampstead)
Chamberlain, Rt. Hon. N. (Ladywood)
Everard, W. Lindsay


Barclay-Harvey, C. M.
Charteris, Brigadier-General J.
Falle, Sir Bertram G.


Barnett, Major Sir Richard
Christie, J. A
Fermoy, Lord


Beckett, Sir Gervase (Leeds, N.)
Churchill, Rt. Hon. Winston Spencer
Finburgh, S.


Bennett, A. J.
Churchman, Sir Arthur C.
Foxcroft, Captian C. T.


Berry, Sir George
Clarry, Reginald George
Fraser, Captain Ian


Betterton, Henry B.
Clayton, G. C.
Gates, Percy


Birchall, Major J. Dearman
Cobb, Sir Cyril
Gault, Lieut.-Col. Andrew Hamilton


Bird, E. R. (Yorks, W. R., Skipton)
Cochrane, Commander Hon. A. D.
Gibbs, Col. Rt. Hon. George Abraham


Boothby, R. J. G.
Colman, N. C. D.
Gilmour, Lt.-Col. Rt. Hon. Sir John


Bourne, Captain Robert Croft
Conway, Sir W. Martin
Glyn, Major R G. C.


Bowater, Col. Sir T. Vansittart
Couper, J. B.
Gower, Sir Robert


Bowyer, Captain G. E. W.
Cowan, Sir Wm. Henry (Islingtn. N.)
Grace, John


Brassey, Sir Leonard
Craig, Sir Ernest (Chester, Crewe)
Graham, Fergus (Cumberland, N.)


Briggs, J. Harold
Crooke, J. Smedley(Derltend)
Greene, W P. Crawford


Briscoe, Richard George
Crookshank, Col. C. de W. (Berwick)
Greenwood, Rt. Hon. Sir H. (W'th's'w. E)


Brocklebank, C. E. R.
Crookshank,Cpt.H.(Lindsey,Gainsbro)
Grenfell, Edward C. (City of London)


Brooke, Brigadier-General C. R. I.
Cunliffe, Sir Herbert
Grotton, Colonel Rt. Hon. John


Broun-Lindsay, Major H.
Dalkeith, Earl of
Grotrian, H. Brent


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Davidson, J. (Hertf'd, Hemel Hempst'd)
Gunston, Captain D. W.


Buckingham, Sir H.
Davidson, Major-General Sir J. H.
Hacking, Captain Douglas H.


Bullock, Captain M.
Davies, Dr. Vernon
Hall, Lieut.-Col. Sir F. (Dulwich)


Burman, J. B.
Davison, Sir W. H. (Kensington, S.)
Hall, Capt W. D'A. (Brecon & Rad.)


Butler, Sir Geoffrey
Dawson, Sir Philip
Hammersley, S. S.


Hannon, Patrick Joseph Henry
Marriott, Sir J. A. R.
Slaney, Major P. Kenyon


Harland, A.
Mason, Lieut. -Col. Glyn K.
Smith, R. W. (Aberd'n & Kinc'dine, C.)


Harrison, G. J. C.
Merriman, F. B.
Smith-Carington, Neville W.


Hartington, Marquess of
Meyer, Sir Frank
Smithers, Waldron


Harvey, G. (Lambeth, Kennington)
Mitchell, S. (Lanark, Lanark)
Somerville, A. A. (Windsor)


Hawke, John Anthony
Mitchell, W. Foot (Saffron Walden)
Sprot, Sir Alexander


Henderson, Capt. R. R. (Oxf'd, Henley)
Monsell, Eyres, Com. Rt. Hon. B. M.
Stanley, Lieut, -Colonel Rt. Hon. G. F.


Henderson, Lt. -Col. Sir V. L. (Bootle)
Murchison, Sir Kenneth
Stanley, Lord (Fylde)


Hennessy, Major Sir G. R. J.
Nelson, Sir Frank
Stanley, Hon. O. F. G. (Westm'eland)


Herbert, Dennis (Hertford, Watford)
Newton, Sir D. G. C. (Cambridge)
Steel, Major Samuel Strang


Hills, Major John Waller
Nicholson, O. (Westminster)
Streatfeild, Captain S. R.


Hogg. Rt. Hon. Sir D. (St. Marylebone)
Oakley, T.
Styles, Captain H. Walter


Hohler, Sir Gerald Fitzroy
Ormsby-Gore, Rt. Hon. William
Sueter, Rear-Admiral Murray Fraser


Holt, Capt. H. P.
Pennefather, Sir John
Sugden, Sir Wilfrid


Hope, Capt. A. O. J. (Warw'k, Nun.)
Penny, Frederick George
Sykes, Major-Gen. Sir Frederick H.


Hopkins, J. W. W.
Perkins, Colonel. E. K.
Tasker, R. Inigo.


Hopkinson, Sir A. (Eng. Universities)
Perring, Sir William George
Thompson, Luke (Sunderland)


Howard-Bury, Lieut. -Colonel C. K.
Peto, G. (Somerset, Frome)
Thomson, F. C. (Aberdeen, South)


Hudson, Capt. A. U. M. (Hackney, N.)
Pilcher, G.
Tinne, J. A.


Hume, Sir G. H.
Pilditch, Sir Philip
Tryon, Rt. Hon. George Clement


Hunter-Weston, Lt. -Gen. Sir Aylmer
Power, Sir John Cecil
Wallace, Captain D. K.


Huntingfield, Lord
Pownall, Sir Assheton
Ward, Lt. -Col. A. L. (Kingston-on-Hull)


Hutchison, G. A. Clark (Mldl'n & P'bl's)
Radford, E. A.
Warner, Brigadier-General W. W.


Iliffe, Sir Edward M.
Raine, Sir Walter
Waterhouse, Captain Charles


Jephcott, A. R.
Ramsden, E.
Watson, Sir F. (Pudsey and Otley)


Jones, G. W. H. (Stoke Newington)
Rawson, Sir Cooper
Watson, Rt. Hon. W. (Carlisle)


Kidd, J. (Linlithgow)
Reid, D. D. (County Down)
Watts, Dr. T.


King, Commodore Henry Douglas
Remer, J. R.
Wells, S. R.


Lamb, J. Q.
Remnant, Sir James
Wheler, Major Sir Granville C. H.


Lister, Cunliffe, Rt. Hon. Sir Philip
Rice, Sir Frederick
White, Lieut.-Col. Sir G. Dalrymple-


Little, Dr. E. Graham
Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Williams, A. M. (Cornwall, Northern)


Lloyd, Cyril E. (Dudley)
Roberts, Sir Samuel (Hereford)
Williams, Com. C. (Devon, Torquay)


Loder, J. de V.
Ropner, Major L.
Williams, Herbert G. (Reading)


Looker, Herbert William
Russell, Alexander West (Tynemouth)
Wilson, R. R. (Stafford, Lichfield)


Lougher, Lewis
Rye, F. G.
Windsor-Clive, Lieut. -Colonel George


Lucas-Tooth, Sir Hugh Vere
Samuel, Samuel (W'dsworth, Putney)
Winterton, Rt. Hon. Earl


Luce, MaJ. -Gen. Sir Richard Harman
Sandeman, N. Stewart
Wise, Sir Fredric


Lumley, L. R.
Sanders, Sir Robert A.
Wolmer, Viscount


Lynn, Sir R. J.
Sanderson, Sir Frank
Womersley, W. J.


Macdonald, Capt. P. D. (I. of W.)
Sandon, Lord
Wood, B. C. (Somerset, Bridgwater)


Macmillan, Captain H.
Sassoon, Sir Philip Arbert Gustave D.
Wood, E. (Chester, staly'b'ge & Hyde)


Macnaghten, Hon. Sir Malcolm
Savery, S. S.
Wragg, Herbert


McNeill, Rt. Hon. Ronald John
Shaw, Lt. -Col. A. D. Mcl. (Renfrew, W.)
Yerburgh, Major Robert D. T.


Macquisten, F. A.
Sheffield, Sir Berkeley
Young, Rt. Hon. Sir Hilton (Norwich)


Maitland, Sir Arthur D. Steel.
Shepperson, E. W.



Makins, Brigadier-General E.
Simms, Dr. John M. (Co. Down)
TELLERS FOR THE NOES.—


Malone, Major P. B.
Sinclair, Col. T. (Queen's Univ., Belfast)
Major Sir Harry Barnston and


Margesson, Captain D.
Skelton, A. N.
Captain Viscount Curzon.


Question, "That the Clause stand part of the Bill," put, and agreed to.

Colonel ASHLEY: I beg to move, at the end of the Clause to insert the words:
(2) No duty shall be payable under the said Section thirteen in respect of vehicles used for no purpose other than the haulage of lifeboats and the conveyance of the necessary gear of the lifeboats which are being hauled.
I am sure this proposal will meet with the approval of the Committee. It simply means that lorries which are used for hauling lifeboats up and down the beach and to bring the necessary gear to enable lifeboats to go out shall be exempted from this duty.

CLAUSE 12.—(Extension of Section 16 of Finance Act, 1921.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Sir HILTON YOUNG: Before we pass this Clause, may I ask the right hon. Gentleman the Financial Secretary to the Treasury, who is always so helpful and so lucid, to tell us briefly what its effect is and why it is necessary. If it were possible for the uninitiated to discover, by any amount of research and hard work, what the effect of it is, I would not venture to trouble the right hon. Gentleman hut, as this Clause stands, it is quite impossible for the uninitiated to discover what its provisions mean, and, under the circumstances, I do not think it will be a waste of time if the right hon. Gentleman tells us what in effect we are voting upon.

Commander WILLIAMS: This Clause affects a considerable number of people, and I am sure that the right hon. Gentleman the Financial Secretary to the Treasury will naturally wish to give the House that full and complete information which is, usually given by the Treasury.
It will be noted that this Clause deals with methylated spirits. These, I believe, are used by certain people for various causes. Rumour has it that sometimes it is used by teetotalers to enable them to rouse themselves for taking part in debates and so forth. I have no knowledge of that part of the subject, but I would ask if, under this Clause, teetotalers will be prevented in any way from getting this commodity. I do not know if this Clause will help the right hon. Gentleman the Chancellor of the Exchequer to remove his deficit in any way or whether it is merely a part of the machinery of the Bill.

The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): I would like to express my gratitude to the hon. and gallant Gentleman the Member for Torquay (Commander Williams) for enlightening the Committee and for giving me an opportunity to dive into the recesses of my box. I do not know that the question which was raised by the right hon. Gentleman the Member for Norwich (Sir Hilton Young) really requires very much elucidation, because the Clause does very little. But what it does do is very necessary. Hitherto, the regulation of the manufacture of spirits has been governed by the Spirits Act. That Act was placed on the Statute Book at a time when there was comparatively little use made of spirits for industrial manufacturing purposes. It is quite true, as has been pointed out by a writer in the "Times," that it is not by any means a modern habit to use spirits in industry, but the amount used until comparatively recently was inconsiderable, I think about 4 per cent. of the total consumption. Now things have altered, and a very considerable use is being made of spirits for different forms of manuacture. We have reason to believe that we are on the eve of a very much larger development of its use. If the Spirits Act, which imposes very strict regulations upon the production and the method of production of spirits, remained unmodified, it would be very hampering to the use of spirits for industrial purposes. Consequently, we are asking the Committee to give us much wider powers of discretion in regard to the use for industrial purposes of alcohol in its various forms, while safeguarding the revenue, of course, from any encroachment
upon it when spirits are used as a beverage. We are asking the Committee to give us this power in order that different forms of alcohol may be produced and handled, because one of the most difficult and restricted parts of the Act relates to the handling of it. If this Clause, with other Clauses which have been introduced, will relieve industry from that burden I have no doubt the Committee will readily agree to it.

Mr. STEPHEN: I listened with interest to the explanation of the Financial Secretary, but there is one point on which I am not quite clear. I should like to ask him whether this is going to make any difference to the revenue. I understand that the provisions which have been in operation in past years have been found to be rather limited and, consequently, they are to be extended in order to provide for the greater use of alcohol and spirits in connection with various processes. Are we to understand that there will be no difference to the revenue one way or the other?

Mr. McNEILL: That is so. It will have no effect on the revenue one way or the other.

Clauses 13 (Provisions with respect to certain processes of distillation), 14 (Amendment as to allowances in respect of spirits), 15 (Power to make regulations requiring returns with respect to importation, etc., of certain, alcohols), and 16 (Bottling of spirits in warehouse), ordered to stand part of the Bill.

CLAUSE 17.—(Income Tax and Super- tax for 1927–28.)

The following Amendment stood on the Order Paper in the name of Sir BASIL PETO:

In page 7, line 35, to leave out the words "four shillings" and to insert instead thereof the words "three shillings and sixpence."

Sir EDWARD ILIFFE: This Amendment was placed on the Order Paper by the hon. Member for Barnstaple (Sir B. Peto) in order to raise the question of the co-operative societies and the Income Tax.

The CHAIRMAN: I think that matter should be raised on the Question, "That the Clause stand part of the Bill." This is an Amendment purely for a reduction.

Sir WILLIAM PERRING: I desire to raise a similar point to that of my hon. Friend, but if you rule that it would be desirable we should raise the point on the Question, "That the Clause stand part of the Bill," I prefer to wait.

The CHAIRMAN: The Amendment raises the question of the difference between four shillings and three shillings and sixpence. If it be desired to raise the question of Income Tax generally, that must be raised on the Question, "That the Clause stand part of the Bill."

Sir W. PERRING: I desire to raise the question of the incidence of the taxation and the inequality which exists under the present system.

The CHAIRMAN: It would be possible to raise that point on the Question, "That the Clause stand part of the Bill."

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Sir E. ILIFFE: I desire to raise the question of the co-operative societies and income Tax. There is a large body of opinion in this House and in the country which thinks it is unfair that a large body of traders should have any special privileges in regard to Income Tax. There is a great deal of difference of opinion as to the amount of revenue which is lost to the Treasury by this privilege to co-operative societies. The Chancellor of the Exchequer estimates that loss at £100,000 per annum, others estimate the loss at something in excess of £500,000 per annum, while the hon. Member for Hillsborough (Mr. A. V. Alexander) told us the other day that the co-operative societies under the present system actually pay more in Income Tax than other traders. It is apparent, therefore, that there is a great diversity of opinion as to how much co-operative societies do benefit by the privileges they possess, and I think it is quite clear that there is a case for an inquiry.
It is very difficult to estimate what the profits of the co-operative societies are
to-day. That is largely due to the system of depreciation. The national programme of the co-operative societies encourages very liberal depreciation. The depreciation recommended is 2frac12; per cent. on buildings and shops, 10 per cent. on fixed stock and plant, and 20 per cent. on rolling stock. This depreciation is recommended to be on the original value of these buildings, shops and plants, and as the value of these assets in the accounts issued by the Co-operative Union is something like £47,000,000 it is quite clear that if this system is rigidly carried out, some £5,000,000 or £6,000,000 may be depreciated, which is much in excess of the amount by which the ordinary trader is allowed to depreciate his assets. Therefore, I feel that the Chancellor of the Exchequer should appoint a Departmental Committee to examine the profits of these societies, and issue a statement showing exactly what profits they are making as computed for Income Tax purposes, what tax they are paying at the present time, and what tax they would be called upon to pay if they were taxed in the same way as their competitors.
There is also a political aspect of this matter. At the present time, certain contributions are made to the Co-operative party, and it seems to me that it is quite possible in the future that further contributions may be made to the Labour party. It seems to me these contributions which are made out of the profits made by the co-operative societies and those profits ought to be taxed under Schedule D. If I make a contribution to the Unionist party, I have to pay Super-tax and Income Tax, and they ought to be called upon to pay Income Tax on their profits. I never can understand why co-operative societies do not readily agree with this view, because it seems to me that in the first place it is equitable and, in the second place, it affects them very little. If the Chancellor's estimate be correct, the only effect on the co-operative societies, would be that it would cost them one-tenth of a penny in the pound upon their sales.
I do not propose to go into the details regarding this taxation. I made a speech on the matter some two months ago, and went into the question rather fully. I would like, however, in order to avoid a certain amount of discussion
to admit straight away that the dividends to the purchasers are not in my opinion profits which are subject to taxation, because they do in fact constitute a reduction in the purchase price. Secondly, it is quite clear that the interest which is paid on the capital invested by members of the co-operative societies is at present subject to Income Tax. The part which escapes taxation consists of the profits which are being put to reserve, and not distributed in any way and the amount represented by over depreciation, which does not at present appear as profits at all. In this connection one must remember that recently co-operative societies have been purchasing a considerable number of competitive businesses, businesses which before they were bought by the co-operative move-men had been paying Income Tax under Schedule D. The price one gives for a business must depend, not only on the profits of the business, but on the amount of the profits one is able to retain, and if a co-operative society can retain a larger share of the profits than any independent purchaser could retain, the co-operative society can always outbid anyone else.
We may be told the law does not tax profits arising from a mutual transaction. I believe that is usually called the principle of mutuality. I submit that that law cannot apply to co-operative societies, because the mutuality has been so greatly diluted. There are 5,000,000 members of co-operative societies, which serve 15,000,000 consumers. That means that a third of the population of the country are served by co-operative societies to-day. We have been told that co-operative societies do not pay Income Tax under Schedule D. I do not think that is true in the case of every part of their enterprise. The co-operative movement has a colliery at Shilbottle. Up to 1926 mines were assessed under "Concerns, 3," of Schedule "A" on the basis of the five years' average, but under Section 28 of the Finance Act, 1926, mines ceased to be chargeable under Schedule "A," and have become chargeable under Case 1 of Schedule "D." Societies being exempt from Schedule "D," one might presume that they would escape assessment, but that is not so. In order to prevent this, there is a proviso to Section 28 whereby exemption
under Schedule "D" is not extended to cover income transfered from "A" to "D" and I understand that to-day the mines are actually paying Income Tax under Schedule "D.'' What I desire to ask the Chancellor of the Exchequer is that not only shall one section of the co-operative movement be assessed to Income Tax under Schedule "D," but every section of the movement, in the same way as are other traders. I hope the Chancellor of the Exchequer will be able to give the House the assurance that he will appoint a Departmental Committee to go into the question and issue a considered statement on the matter.

Mr. HANNON: I rise to support the arguments of my hon. Friend the Member for the Tamworth Division (Sir E. Iliffe). This question of the equitable taxation of co-operative societies has been before Parliament on many occasions, and those of us who feel that co-operative societies vis-aàvis the ordinary retail trade enjoy a preferential position think the time has come for an inquiry to ascertain the precise circumstances under which they carry on their trade in relation to the collection of the revenue. My hon. Friend the Member for Tam-worth has given a great deal of time and thought to the examination of this problem, and I think the facts he has submitted to-night must have made a considerable impression upon the mind of the Chancellor of the Exchequer. We are not asking for any particular penalisation of co-operative societies. As my hon. Friend pointed out, there is no suggestion of asking that co-operative societies should pay Income Tax on the dividends which in the ordinary course of their business they give to their members; but we feel very strongly that the co-operative society, which not merely confines its operations to its own members, but competes with the ordinary trader and canvasses for business as against the ordinary retail trader, should certainly be brought under the operation of the ordinary taxation system of this country.
In Birmingham, we have a very great co-operative society, and, within the limits of real co-operation, I have always been an ardent advocate of co-operation among the working classes of this country. In this particular case, however, and, indeed, in many others
throughout the country, you have the example of this great enterprise acquiring large businesses which were previously carried on by private enterprise, absorbing them into their co-operative network, and then at once securing immunity from payment of the ordinary taxation which was incidental to the previous conduct of those businesses in private hands. I do not think that that, in competiton with the ordinary trader, is really a position which the co-operative society ought to occupy, and I think that my hon. Friend the Member for Hillsborough (Mr. A. V. Alexander), who in this House is the very respected and eminent protagonist of the interests of the co-operative movement, would, in justice to his own self-respect, like to feel that his great movement was not enjoying any particular advantage at the expense of the ordinary private traders in this country.
The co-operative societies advertise that you deal only with "co-ops"—I am using the ordinary vernacular phrase employed by co-operative societies—but at, the same time, you find in some of the provincial newspapers whole-page advertisements inviting people to deal with co-operative societies, and we have no means of ascertaining whether in point of fact bona fide membership of a co-operative society is established before such transactions are carried out; and that is something which a Departmental Committee of the quality suggested by my hon. Friend would certainly help to determine. I, as an old co-operator myself, on the side of productive co-operation, and, as one who gave many years of his life to preaching co-operation among farmers, am the last person in this House to say a single word that would be unfair to the co-operative movement, but when I find, in my own city of Birmingham, this great organisation constantly carrying on its work in conflict with the ordinary retail trader, who has to struggle with the payment of rates and taxes, and otherwise to discharge his obligations as a citizen, I think the least that might be asked from the State is that both sets of traders should be put exactly on the same level in relation to the collection of the revenue which maintains the whole administrative machinery of this country.
Therefore, with great respect, I submit to the Committee and to the Chancellor of the Exchequer that the time has come when some impartial inquiry, giving every possible consideration to the bona fide interests of co-operative societies, on the original principle on which they were established, should be undertaken to examine to what extent the business is conducted without any loss to the revenue, while at the same time conforming to the ordinary principles which govern the trade of other people in this country. That, I think, is a perfectly fair proposition to submit to the Chancellor of the Exchequer. Of course, he pointed out to us that we have supplied him with a great deal of useful information, but it is one of the qualities of the Chancellor of the Exchequer that, while the information supplied to him is always of the most admirable quality, he very often does not accept it at all, and I am not quite certain that he accepted the whole substance of the valuable Memorandum which my hon. Friend and others presented to him on this subject. But, after the speech of my hon. Friend the Member for Tam-worth, I think the Chancellor will see the plain justice of the suggestion we are making to him, not that he should interfere in this Finance Bill with co-operative societies, but, that he should have an investigation carried out which will satisfy the whole community, including co-operators themselves, that they are not in any respect receiving special advantages from the State which place them in a preferential position in contrast with other citizens who have to pay taxes. That is the proposal we have submitted to the Chancellor of the Exchequer. That is the whole project put forward by my hon. Friend, and I very much hope the Chancellor of the Exchequer will see the propriety and, indeed, the justice, of acceding to the suggestion that has been made to him.

Marquess of HARTINGTON: My object in speaking on this Clause is not so much to deprive my right hon. Friend of all revenue from Income Tax and Super-tax, which would, I understand, be the effect if the Clause were negatived, as to call attention to the very real injustice which arises under the present system of collecting Income Tax and, if possible, to move my right hon. Friend
to an act of clemency. I quarrel particularly with Sub-section (2), which perpetuates all the various enactments of the past with regard to the collection of Income Tax and Super-tax. I have taken the earliest moment of raising the question of the machinery of these taxes, because I think it is very important that before the Committee authorises the continuance of this machinery for another year we should have some statement from my right hon. Friend as to his intentions in the matter.
It is a matter of universal complaint, and it is even admitted by the Chancellor of the Exchequer, that the enactments with regard to the collection of Income Tax and Super-tax are drafted in such a way as to be almost completely unintelligible to the people who have to pay the taxes. I want, in passing, to protest against being governed in an alien language, in the language of a small body of men, aloof from the industrial and commercial life of the nation, who regard the main body of the citizens of the country as having one function and one function only, that of producing more and more revenue in ever-increasing quantities to satisfy their own ever-increasing demands. My right hon. Friend will possibly tell us that that is inevitable and that it is impossible to re-draft the various enactments relating to income Tax and Super-tax in such away that they will be easily understanded of the people. That may or may not be so, but there is a widespread suspicion in the country that the revenue authorities purposely keep these Acts in an unintelligible form because they realise very large sums indeed in excess of what they are strictly entitled to realise. If it is indeed the fact that it is impossible to re-draft these various enactments in plain English, most earnestly hope my right hon. Friend will give the Committee some assurance that the cost of discovering what they really mean shall be borne, not by some unfortunate individual taxpayer, as has so often been the case in the past, but by the main body of the taxpayers.
It has long been an injustice—I think that this has also been admitted by the right hon. Gentleman—that the taxpayer who feels that he is aggrieved may take his case to the General or Special Commissioners, and win his case, and again
and again it has happened that the revenue authorities have appealed until it becomes impossible for the ordinary taxpayer to go on. There have been very many cases where the taxpayer has won his appeal, but has lost the benefit of it because he has been unable to face the risks and the costs of further litigation. Law costs entail an immense burden, and it is impossible for very many people to face the risk, and, as my right hon. Friend very well knows, even if the taxpayer ultimately wins his case and is awarded costs, the taxed costs do not amount to anything like the total expenses he is called upon to bear.
Last year my right hon. Friend received an influential deputation on this subject, which included, I think, some hon. Members of this House. With the dexterity which we are accustomed to expect from him, he sent that deputation away almost satisfied, but completely empty. The injustice was a severe one then, but if this year's Finance Bill goes through, it will be infinitely worse. My right hon. Friend in introducing his Bill claimed with what seemed to be some show of satisfaction, that he might say with safety, that few people would understand its language. I think that anyone who studies this Finance Bill will agree with my right hon. Friend that in that respect, at any rate, his claims for this year's Finance Bill are more than justified.
When he received the deputation last year he pointed out, in reply to their representations, that same injustice existed in other things. I think I have got his words:
In all other fields of controversy where a person of small means fought against the large and rich corporations,
I would urge in reply to that, first, that two wrongs do not make one right, and, secondly—and it is a very much stronger point—that in no other field of controversy is it one of the parties which itself has framed the legislation which is the subject of the dispute. That is my contention. Parliament may possibly have a right to frame unintelligible legislation if it sees fit to do so, but, I think, it can hardly be conterded that Parliament his a right to frame legislation which cannot be understood by the mass of the people who are affected by that legislation, and then to insist that the cost of finding out what it really does mean shall be borne by certain selected individuals.
I believe that my right hon. Friend can make a concession on this point without incurring any substantially increased burden of law costs. The dice are so heavily loaded in his favour now that the can afford to give away an ounce or two. I need not remind him that it is now the law that if a taxpayer feels himself aggrieved, and goes before the Special or General Commissioners, and they find against him on a question of fact, no further appeal is open to him.
That avenue is closed, and quite rightly. I do not quarrel with that. It is only when the question of the interpretation of the law arises that an appeal is possible, and it is obviously desirable where you have one of these very difficult and complicated questions of the interpretation of the law that an authoritative and final ruling should be obtained. That means a decision by the House of Lords. I do not complain: it is obviously desirable that these rulings should be obtained, but what is unjust is, that the very heavy cost of obtaining a ruling of this kind, which it is in the interests of the general body of the taxpayers to obtain, should be borne by an individual and not by the general body. I do not suggest, and I would not expect my right hon. Friend to accept it if I did, that the cost of all appeals should be borne by the revenue authorities. I do think it reasonable to suggest that where the Crown appeals from the decision of the Special or General Commissioners—and I think it is a specially reasonable suggestion in view of this year's extremely complicated legislation—the Chancellor should give us some assurance before we go any further that it should be the Crown that bears the cost of both parties.
It is not and cannot be just that the Crown should win cases—and it very often has done in the past—merely in default of the ability of some particular taxpayer to go to appeal and again to the House of Lords. The risk he runs in most cases vastly exceeds the amount which is at stake. Cases of the kind I have in mind are not fought to wring a few pounds from a taxpayer, but to get a ruling on a principle, and they are of benefit to the whole body of taxpayers and it is right that they should pay the cost.
It is more than 600 years since the English people assimilated their Norman conquerors and ceased to groan under the burden of being governed by an alien race in an alien language. As the paintings which have just been unveiled in St. Stephen's Hall may remind us at a time when we need reminding, it is more than 400 years since the sources and origins of our religion became available to us in the common tongue, and now, after all these years, we are again having to complain that our temporal and spiritual rulers are attempting to govern us in a language which we cannot understand. I hope that the right hon. Gentleman's Norman blood, which at this season of the year in particular, is even more in evidence than his kind heart or simple faith, will not induce him to refuse the rather small concession which I ask. I would remind him of the fact that there have been some rumours of discontent, that some sullen mutterings of the Saxon serfs, must already have penetrated his castle walls.

The CHAIRMAN: The argument of the Noble Lord appears to be a little obscure, but I doubt if it is relevant to the re-enactment of the Income Tax.

Marquess of HARTINGTON: I have only three more words to say. There have been rumours that the burden of the Income Tax and the complexity of the enactments by which the tax is collected have caused complaint. I believe some murmurs of discontent have reached the right hon. Gentleman's ears, and I would urge that a wise concession now might not only save him a great deal of trouble but would remove a really severe injustice.

Mr. CHURCHILL: The moving peroration to which we have just listened must, I regret, to some extent leave me unmoved. The question of the costs in such cases has often been discussed, and debated; and as my Noble Friend reminded us, I received a deputation on this subject only a year ago. It is not the fact that it is the practice of the Inland Revenue to wear down the poor appealing tax-payers by carrying them on from Court to Court until their funds are exhausted. When test cases are taken up and encouraged in order to arrive at a general decision on a point of law. The Board of Inland Revenue have the
discretion, and frequently use it, to pay the costs of the other side in whole or in part, but in regard to cases which are not test cases, but which are controversial disputes designed to settle a case as between the Crown and a particular party rather than arrive at an interpretation of the law, it seems to me to be a very moderate claim that costs should follow the judgment. In ordinary cases the Crown does not pay costs whether it wins or loses, but in the Income Tax sphere it does pay them if the judgment goes against it. But to pay costs in all cases would surely be to foster and incubate litigation against the Crown to an extent which, though it might be highly satisfactory to many of our hon. and learned Friends who are present, would, I am sure, result in a vast amount of needless disputation in the Courts, and a very considerable addition to those burdens of the general taxpayer in regard to which my Noble Friend has so feelingly descanted.
When my Noble Friend speaks of the importance of writing the Income Tax laws in a tongue understanded of the people, I am entirely in accord with him, and I am setting up, as I mentioned in the Budget speech, a highly expert Committee of lawyers, who will have the fullest assistance which can be rendered them by gifted laymen, for the express purpose of consolidating and re-writing this immense tangle of Income Tax laws which has grown up, year after year, in the last three or four generations, and which rolls on like a snowball from Session to Session with ever-growing additions and complexities. It is believed that that Committee might, in the course of the next five years, make a considerable inroad on this subject, and I have arranged for its work to be expedited as much as possible, and for interim Reports to be issued in order that we may simplify as far as possible our legislation. But I should like to point out that though we might simplify the statement of the purpose of a Clause in the Bill from the literary point of view, and make it very easily apprehended by the ordinary reader, yet when that came to be interpreted in the Courts it might lead to far greater difficulties of interpretation and argument than arise when
the recognised and highly respectable jargon and rigmarole of a great profession is employed.
I come to the other question which has been raised, and here I must endeavour to compress into a few sentences what is an immensely interesting and important topic. I have given close attention to this allegation that the co-operative societies do not pay their proper share of the Income Tax, and I have used the full machinery of the Inland Revenue to explore that subject. In the result I have been convinced that they pay very nearly the full tax that could be exacted from them under the law, and I will explain exactly how this arises. I do not want to keep back the hon. Member for Hillsborough (Mr. A. V. Alexander) who is preparing to make a vigorous speech, but I hope that if what I am saying expresses, to some extent, the views he is going to express, he will not think it necessary to go over that ground a second time. The public accounts of the trading co-operative societies show that, as a result of the year's working, they had about £21,000,000 in hand. Of this £21,000,000, they paid away £14,000,000 as discount on purchases. This sum of £14,000,000 is usually described as "divi." This "divi;" which is a very well-known phrase—

Mr. E. BROWN: It is understood by the common people.

Mr. CHURCHILL: It is well understood as "divi." This "divi." cannot possibly be charged to Income Tax. It is a trade discount which is immune in every sphere of our taxation schemes from Income Tax. Income Tax has never been charged on trade discounts, and to do so would upset the whole of the long-established trading methods of this country. If it were attempted to charge Income Tax on trade discounts, obviously the attempt would be defeated by the simple process of selling the article at a cheaper price. So much for £14,000,000. If, however, it were decided to alter the law in regard to trade discounts, then, although you might charge the individual co-operators with their "divi." for the purpose of Income Tax, it would be found that in nearly every case they are below the Income Tax level, and nothing would come of it. It is calculated that from the whole process only £100,000 would be recovered,
and to achieve that £100,000 it would be necessary to overturn the long-established system by which trade discounts are immune from Income Tax.
11.0 p.m.
A sum of £14,000,000 taken from £21,000,000 leaves £7,000,000. That £7,000,000 can be accurately described as the societies' profits. Of this £7,000,000, they distribute something like £4,000,000 every year to their shareholders as interest on shares. When an ordinary company pays a dividend to its shareholders, income Tax is deducted, as everyone knows, at the source, and the shareholder gets a lesser sum. In the case of co-operative societies, a different process prevails. So many of their shareholders are below the Income Tax level that it would be an infinitely more costly business to deduct the Income Tax at the source and then have all these small repayment claims from millions of people. Instead of that, the tax is not deducted at the source, but individual shareholders in the co-operative societies are forced to include their profits in their Income Tax returns, if they pay Income Tax. If they do pay Income Tax the tax is recovered accordingly. So much for the £4,000,000, which, taken from £7,000,000, leaves £3,000,000. Now on the £3,000,000, or actually a little more than £3,000,000, which remain to be accounted for, Income Tax if charged at the standard rate would amount to £650,000. As a matter of fact, the slightly different system by which co-operative societies are taxed, for reasons I have explained, yields, mainly under Schedule A, £550,000 a year. So that under the present system of taxation they pay within £100,000 of what the strict working of the ordinary law would exact from any other similar trading body. Now, in order to obtain this £100,000 by which the taxation paid by these societies falls short of the total, it would be necessary to impinge upon the principle of mutual trading which rules at the present time over a very wide sphere, and it would not be worth while to renounce that principle and to antagonise a very large body of citizens for a comparative small result. I have done my very best to test these figures and I do not think they could be challenged. Therefore, I do not see what
an inquiry could do. The Inland Revenue and the Government are quite impartial in this matter. They have no reason to conceal any fact whatever. One can, indeed, feel sympathy with the traders who find themselves oppressed by the immense collective power of these co-operative bodies, which unite all the force of massed capital, and whose shareholders do not pay Income Tax individually because they are below the Income Tax level. Nevertheless, full and impartial administration of the law would only disclose a difference of £100,000.
I do not see why this great body of co-operators themselves do not come forward to make an endeavour to bridge this gap. I do not see why this should bring a laugh, because it is hardly worth while to have this criticism levelled at them that with all their immense wealth they are not contributing the normal amount of taxation to the revenue. It would be more in accordance with their dignity and prosperity if they were, in some way or other, by consultation or otherwise, to bring their taxation up to the exact level of ordinary trading concerns, so that the Inland Revenue should be able to say that they took no part whatever in discriminating between different trading bodies in the country. I have tried to place before the Committee the outstanding features of this important question, and I hope that the Committee will see that the Government must decline to accept the proposal to set up an inquiry which could yield no result.

Mr. A. V. ALEXANDER: I can assure the Chancellor of the Exchequer that he need not be alarmed either by the length or the vigorousness of the speech that I shall make this evening. I thank him for his very clear statement of the principles which the Government have decided to adhere to in regard to the taxation of Co-operative Societies. There were one or two things, however, at the close of his speech to which I am sure he will expect me to make some reference. It is a curious thing to find a Chancellor of the Exchequer standing up in the House when the question of obtaining revenue to meet expenditure by means of taxation is discussed to invite one section of the community to make a voluntary contribution. That is rather a new method of raising direct taxation, and he will hardly expect that a body of five-and-a-quarter
million people in this country, most of them of the working-class type and most of them with a standard of life which can bear no more taxation, will welcome with enthusiasm the suggestion that they should make a voluntary contribution when successive Chancellors of the Exchequer in the last few years have reduced the Income Tax from 6s. to 4s. in the pound. It is a method of taxing the subject which cannot be accepted.
I would also ask him to remember that so far as the gap to which he referred in submitting the estimated figures is concerned there is a strong view in the Co-operative Movement that there is no such gap at all, and I would ask him to consider it for a moment or two. In the first place in regard to the Inland Revenue figures I want to point out that though the hon. Member for Tamworth (Sir E. Illiffe) and the hon. Member for Moseley (Mr. Hannon) appear to have given great attention to the subject, their figures are not to be relied upon. All they do is to take figures in the mass from the annual returns made to the Registrar, covering only the figures required by the Registrar, and then draw certain conclusions, whereas the Inland Revenue upon whom the Chancellor relies have the advantage that as a result of the Corporation Profits Tax legislation of 1920–21 Somerset House has had for at least two financial years all the detailed Balance Sheets of all the Co-operative Societies in the country. They, therefore, base their estimate on the actual details of the trading Balance Sheets which they have actually examined. If you take the position to-day, we pay far more under Schedule A than is estimated by the Chancellor of the Exchequer. He has admitted quite clearly and fairly that if he attempted to assess Societies under Schedule D at the source he would find great difficulty arising in regard to people who are below the taxable limit, who would immediately claim rebate. But supposing the Chancellor, either by consent or by imposition, levied a sum of £100,000 upon the Movement for Income Tax under Schedule D, how could he refuse the right to any individual member of the Movement who felt himself over taxed to claim that rebate? Consequently there would be no gain to the Exchequer.
With regard to the request for an inquiry, the matter, of course, has already been fully examined, and the Report of the Buxton Committee of 1905 and the Royal Commission of 1919 are largely agreed in principle. The Buxton Committee stated that the private traders had failed to make out any case for a change, and that certainly the revenue would not gain in any way by an assessment. That provision, I believe, still holds good.
In view of the request made to me by the Chancellor of the Exchequer I do not propose to traverse again the ground that he covered, although there were many things in the speech of the hon. Member for Tamworth and the hon. Member for Moseley that ought to be answered. If, however, these points are raised by them again, I reserve the right to reply to them.

Sir W. PERRING: I am extremely disappointed with the statement of the Chancellor of the Exchequer. As far as it has been possible to analyse the balance sheets of the co-operative societies, the conclusion has been come to that £100,000 was profit. It is well known that the turnover of the co-operative societies is now bordering on £300,000,000. I have in my hand the balance sheet of the London Co-operative Society, which represents only £5,000,000 out of that £300,000,000. It is interesting to note that in this last half-yearly balance sheet, called the Fourteenth Report, there is shown a profit of £250,000 in the half year, which means £500,000 on the whole year. Out of that sum they are only distributing in the half year £140,000. Having made provision for the interest on the capital, they anticipate a profit in the half-year of £68,000. If that is the anticipated profit shown on the balance sheet of the London Co-operative Society on a turnover of £5,000,000, that shows that the sum involved is out of all proportion to the statement of the Chancellor of the Exchequer that there is only £100,000, spread over this large turnover in the country. I will proceed just a little further in the analysis of this £68,000.

Mr. ALEXANDER: I do not want to curtail the hon. Member's part in the discussion, but it might help and save time if I pointed out that those reserves are within the principle of mutuality outlined
by the Chancellor of the Exchequer. The question as to whether a profit is a taxable profit does not depend upon the use to which it is put, but upon its source and the manner in which it is made. The whole of the surplus, whether distributed in discounts or placed to reserve, is the result of the mutual trading of the members.

Sir W. PERRING: We challenge the principle of mutuality in this Debate. I desire to point out, in an endeavour to arrive at what are the anticipated profits, that on this very balance sheet there is a capital account of £1,600,000 for land, plant, and buildings, and during the period of the London Co-operative Society's activities they have reduced this sum by 33 per cent. I quite admit, from a financial point of view, that may be a very wise policy for the co-operative societies, but what I desire the Chancellor of the Exchequer to observe is that any ordinary private trader is not allowed, for the purposes of Income Tax, to write down his plant, land and buildings in that way. Every item that he writes down—his plant, buildings and stock—is brought into account for purposes of Income Tax, and if this policy is pursued for another 10 or 15 years, there is every indication that the increasing activities of the co-operative societies, with their swelling and increasing profits, will enable those societies ultimately to write off all their capital account. That might be all very well, but, speaking as a trader, and recognising that the primary purpose of the co-operative movement is to send every trader out of business, it is important to remember that the cooperative societies are allowed, under the present system of taxation, so to put to reserve in writing down their assets and using the additional capital for the development of their business, that they are building up a system which the Chancellor of the Exchequer will be compelled to take into consideration. In his speech last June the right hon. Gentleman said that he desired to secure the taxes of the country with the minimum political disputation. That suggests that he does not want to disturb the members of the co-operative societies, on the ground that it would stir up a lot of trouble. If this system is developed until the turnover is doubled,
and there is every indication that it will, then the right hon. Gentleman will have far greater difficulty in dealing with this problem in the future than he has to-day. We feel that an inquiry into the items to which I have referred would reveal the fact that the reserves and undistributed profits are largely in excess of the figure given the Chancellor of the Exchequer by the staff at the Treasury. He would recognise, if he analysed the figures—

Mr. CHURCHILL: I have given prolonged study to this very question, and have endeavoured to make sure that the figures were accurate.

Sir W. PERRING: I am delighted to hear that the right hon. Gentleman has examined these figures. The traders of the country are certainly not satisfied with the figures mentioned by the Chancellor, and assuming that it is only £100,000, which I challenge, the right hon. Gentleman has not been unmindful of sums less than that amount, and he is developing a system by which he desires to make those who have escaped pay their proper proportion of Income Tax. This desire for increased revenue and the necessity to bring into the net all those who have escaped, should be extended to the members of the co-operative movement, and, having regard to the enormous burdens which the traders of the country have to bear, it is unfair that any section should be able to develop a system of trading without paying their quota to the revenue. In view of the exigencies of taxation, and the development of this movement, the Chancellor of the Exchequer will be compelled in the future in equity to all concerned to bring into our taxation these reserves and undistributed profits.

Sir HENRY BUCKINGHAM: I should like to follow my hon. Friend in the eloquent appeal he has made to the Chancellor of the Exchequer, but at this late hour I will not do so, as I have had the opportunity of expressing my views to him on a former occasion. My only object in rising is to call the attention of the right hon. Gentleman to the fact that the statutory allowances for repairs and maintenance claims will expire in April, 1928, unless Parliament otherwise determines, and I should like to know whether the Chancellor proposes to deal with this matter before next
April. The Budget will not have been introduced by then, and an awkward situation may arise if by April of next year Parliament has not otherwise determined. These statutory allowances will automatically cease. I ask the right hon. Gentleman if he will be good enough to take the matter into consideration in the meantime.

Mr. CHURCHILL: My hon. Friend has been good enough in connection with this Finance Bill to give me an opportunity of referring to a great many points, and I have profited by his action to look into them. I do not, however, recollect that this was one of the subjects which he suggested to me in any of our talks, nor, I think, has attention been drawn to it in any other way. This would appear to be a somewhat recondite and highly technical matter, and perhaps he will agree that should any statement upon it be necessary, it can be deferred until the Report stage is reached.

Sir H. BUCKINGHAM: I am only anxious that the matter should be placed on record.

Sir HILTON YOUNG: There is, I think, one observation to be made in reference to the unintelligibility of Income Tax legislation to which the Noble Lord the Member for Western Derbyshire (Marquess of Hartington) has called such well-deserved attention. The Chancellor of the Exchequer has said that it is impossible in the present state of Income Tax law to deal with other than legal phraseology for the purposes of such legislation. If I may say so, without assumption, I think he is quite right. He said further that it is not impossible to interpret such terms in a more literary and intelligible form. I have no doubt that is done year by year by the able officials of the Inland Revenue but, he added, that the more intelligible form would be useless for the purposes of legislation. While that is no doubt true, the suggestion I have to make is that the more intelligible and literary form would be of great use to Members if given in a White Paper. I think it is universally admitted that Income Tax legislation has become utterly unintelligible tı the ordinary person. For purposes
of illustration, let me refer to Clause 26 of this Bill. The average citizen may read it through, right side foremost or back side foremost, and yet be totally unable to attach any meaning to it. It is little short of a public danger that we should be called on to legislate about things that we cannot understand, and it would be to the advantage of the public, if it is possible to make them intelligible to the House, by giving us first aid in the form of a White Paper, that it should be done. There may be a question of the time not having arrived for such a precedent, but the suggestion is worthy of consideration.

CLAUSE 18.—(Amendment as to date of payment of tax under Schedule A.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Sir JOHN MARRIOTT: This Clause, to which I wish to refer briefly, may not be one of the most important Clauses in the Bill, but it is one of the most characteristic, and it is one which, in my opinion, ought not to be added to the Bill without some words of explanation. I say it is one of the most characteristic Clauses of the Bill, and if I had to characterise this Bill in a sentence, I should describe it as a Bill for papering over the cracks. No one can question the existence of the cracks, they are large and gaping, in the potential revenue of the year. I imagine the Chancellor must have arrived at his decision to insert this Clause by some such argument as this. He said to himself, I imagine, "I cannot and I must not appear to increase taxation; I must not frighten the consumer of the necessaries of life by adding to indirect taxation; I must not alarm the income tux payer; but additional taxation, by hook or by crook, I must have. I will get it honestly if I can, and otherwise if I cannot."
He approached this problem with all his accustomed ingenuity. He designs, by camouflage, I take it, to conceal from the taxpayer the very deadly instrument of warfare by which he and his colleagues are going to be assailed. In this case we have one of the most ingenious of the
many camouflages with which the Bill is adorned. This Clause proposes that Subsection (2) of Section 157 of the Income Tax Act, 1918, a Section which provides that in the cases to which that Sub-section applies Income Tax shall be payable in in two instalments, shall cease to have effect so far as it relataes to tax chargeable under Schedule A:
other than any tax so chargeable in respect of income which is, or is to be treated as, earned income.
Most members of the Committee will recollect that under that Section 157 it was for the first time enacted that instead of Income Tax being payable in one instalment on or before the 1st January it should be payable in two equal instalments, the first on or before 1st January and the second on or before 1st July. This concession, for it was a concession, made by the Chancellor of the Exchequer of the day applied not only to tax payable under Schedule A but to several other categories of Income and Property Tax. It applied to tax payable under Schedule B where it was charged in respect of lands occupied for husbandry only; and it was applicable to payments under Schedule D and Schedule E. But to this general concession made in the Act of 1918 there were two notable exceptions. The first was in the case of weekly wage-earners, whose tax was assessed as a rule half-yearly, and the other was in the case of railway companies, who paid under Schedule D by four quarterly instalments. The point that I want the Committee to observe is this: The concession, when it was made in 1918, was a concession granted practically to all payers of Income Tax, and was not then limited to payers under Schedule A alone. In this present Finance Bill, in order to make up the deficit to which I have alluded, the Chancellor of the Exchequer proposes to take away the concession made under the Act of 1918 in regard to paying Income Tax in two half-yearly instalments, but to take it away from one class of taxpayers only, that is to say, those who are owners of land and owners of house property, whereas other taxpayers, who may be in an equally good or in many cases a far more favourable, position, are still left with the concession which was granted in 1918.
I can easily believe that, in extenuation of the proposal made by the Chancellor of the Exchequer, it may be urged, and I believe it has been urged, that the concession in regard to payment under Schedule A in two equal half-yearly instalments was only introduced—and I imagine that this will be the argument of the Chancellor of Exchequer—at a moment when the standard rate of Income Tax stood at 5s. in the £, and when, therefore, it was not practicable to leave it to be paid in one sum, owing to the fact that many tenants would not be able to deduct the tax, as they are entitled to do, from the rent payable to the landlord. If, however, that had been the case, the concession I have named would have been made in 1918 only to payers of Income Tax under Schedule A, but, as I have already pointed out, it was a general concession made to all categories of Income Tax payers. Whatever the motive may have been when the concession was originally made in 1918, that concession is now to be withdrawn, and I suggest that the Clause as it stands is one which ought to be resisted on two grounds—firstly, on the ground that it is a manifest injustice to discriminate between one class of Income Tax payers and another, especially if you discriminate against those who are less able to pay; and, secondly, on the ground that it involves a very grave hardship to the particular class of taxpayers whom it will affect. It will involve hardship to them whether they are owners of agricultural property—and everyone knows their position to-day—or whether they are owners, particularly if they happen to be small owners, of small urban property.
As regards agricultural property, the position under the Bill of this year will be this: The landowner will have to find the whole of his tax under Schedule A for the year on 1st June. He will already have discharged the second half of his tax for the current year, that is to say, in July, 1927. In most cases agricultural rents are payable half yearly, at Michaelmas and Ladyday. Practically the whole of the rent payable at Michaelmas, 1927, will have gone in discharging the July instalment of this year and consequently the unfortunate landowner will have no funds at all out of which to pay his full year's Income Tax in January next. He will have either to
borrow from his banker or run into debt in order to discharge his obligations to the Exchequer.
So much for the position of the agricultural landowner. I am going to add a word on behalf, not of the large landowner, not the great bloated capitalist, whom we are supposed particularly to represent, but the very large number of small owners of small property. Let us see the position in which they will be placed by this Bill. I will not go into particular illustrations. I would rather put the matter on this broad ground, that these owners of urban property are called upon to pay as Income Tax during the next twelve months, which is 50 per. cent. in excess of the Income Tax they had to pay last year and 50 per cent. in excess of the Income Tax payable by any other class of Income Tax payers. I know the Chancellor of the Exchequer will do all he can—and he can do a great deal—by his ingenuity to camouflage this proposal, but no argument on his part can disguise the disagreeable fact that these unfortunate people, the landowner and the owner of urban property, will be called upon during the next twelve months—as a matter of fact during the next seven months—to pay 50 per cent. more Income Tax than they expected before the Budget was introduced. It is futile to attempt to comfort them with the assurance that this matter will be straightened out six months after the end of the world. I suggest that it should be straightened out before that time, and that is because they refuse that cold comfort the Chancellor suggested that I oppose the Clause.

Mr. MACQUISTEN: As far as I understand this Clause, it amounts to this, that those who in the opinion of hon. Members opposite are guilty of the gross offence of owning heritable property are to be made to pay 18 months' taxation in 12 months. They are going to pay 50 per cent. more. They are to lend money to the Chancellor of the Exchequer by paying it six months ahead. How they are to borrow it from the banks, I do not know. Apparently, they will have to do it. I do think it is a very great hardship, and therefore I think the Chancellor of the Exchequer
ought to give us a better excuse for what he is doing than he gave to us in his Second Reading speech.

Mr. R. MORRISON: I desire very briefly, although I cannot do so with the same degree of eloquence, to support the case against this Clause, and I sincerely hope the hon. Member for York (Sir J. Marriott) and the hon. and learned Member for Argyll (Mr. Macquisten) mean to press it. We shall know within a few moments whether they actually mean what they say, or whether they have only made speeches for the sake of speaking. If they are prepared to go into the Division Lobby, I am prepared to be one of the tellers. I say this in all seriousness, because it is a very serious matter. I suggest to the Chancellor of the Exchequer that although there is no considerable amount of interest in this question at the present time, there will be a tremendous outcry about it next January and February, and it will lose thousands of votes to the Conservative party. I will tell the Committee how I think this is going to happen. [Interruption.] I do not usually indulge in political prophecy, but this is how it is going to occur. In most constituencies thousands of working-people have purchased their houses through the Small Dwellings Acquisition Act and through other schemes. They were called upon, as everybody knows, to put down from £50 upwards, and they have to pay the balance by instalments. The figures relating to persons who are buying their houses have been given in this House repeatedly by the Minister of Health, and they run into many thousands. The people who are doing this are respectable working people, most of whom have families, and it is because they have families that they experienced greater difficulties than other people in finding houses to rent. They have been compelled to buy their houses. Many of them have had to borrow money in order to enable them to make the necessary deposit, and the local authority or some enterprising builder has advanced the rest. The repayments these people, who are mostly of the artisan or working class, have to make, inclusive of rates, amount to from 24s. to 30s. per week. That money has to come from homes where the weekly income is £3, £3 10s., or £4 at the most. That is the instalment they
have to pay under the Small Dwellings Acquisition Act. I should say that in my constituency there are 400 or 500 of these people, and I know that a great many people in the constituencies of other hon. Members are in a like position.

Mr. CHURCHILL: What is the scale of income of the class about which the hon. Member speaks?

Mr. MORRISON: The scale of income would be round about £200.

Mr. CHURCHILL: That is beneath the Income Tax limit.

Mr. MORRISON: I would point out to the right hon. Gentleman that up to now, at any rate, though I have made endeavours on their behalf to get exemption from Schedule A, they have been compelled to pay it—even working men. I would sit down directly if the right hon. Gentleman would make a statement that the people who do not come under the ordinary Schedule for earned income are exempt from Schedule A. If he could do so this discussion would have been very useful. While the right hon. Gentleman is finding that information, I would only add that in having to pay the whole of the amount, which will amount to between and £2 and £4 per annum, in one lump sum, it is going to cause a very great amount of distress to a number of people. It is going to cause them to fall into the hands of moneylenders or to fall behind with the instalments payable to the local authority. For all these reasons, I hope the hon. Gentleman who so eloquently presented the case against the Clause and the hon. Member who supported it will press it to a Division. I am sure every Member on this side of the House will gladly support them.

Mr. CHURCHILL: The hon. Member (Mr. Morrison) will be relieved to hear that no one who is below the Income Tax limit will be called upon to pay Schedule A, and the class of people he has described will be below the Income Tax limit. A married man with two children earning an income of —300 a year will be below the Income Tax limit, and can quite easily recover his Schedule A payment if it has been made. Therefore, the grievance of which the hon. Gentleman has been speaking has really been removed, so that any objection
he has to voting for this Clause will fall with the grievance which he has expressed. I do not intend to go into the general question raised by my hon. Friend the Member for York (Sir J. Marriott) in a speech which, at one time, I was really afraid might not end until six months after the end of the world. I should like to say, however, that he made an excellent speech, and I was almost ready to wait so long. This is a very important Clause, for without this particular method of dealing with the difficulty we should undoubtedly have to face a substantial rise in the standard rate of the Income Tax. It is certain that next year we shall be in a better position, and therefore a method of this kind, the beneficial effects of which are only experienced for one year, is appropriate, and more appropriate to the present financial problem than the provision of a permanent tax. Although my hon. Friend has made a powerful speech, I have not, through the many channels open to me, been able to receive any serious body of complaint from any part of the country to this provision.

Mr. MORRISON: Several of my colleagues agree with the statement I made that there are scores of artisans whose income is not sufficient for them to pay ordinary Income Tax, who are paying year by year Income Tax under Schedule A. Can I take it that if they are asked to pay any more they can get complete exemption?

Mr. CHURCHILL: Certainly. If, however, there be any doubt, the hon. Gentleman had better put me a question to which full publicity can be given.

Mr. SNOWDEN: What my hon. Friend refers to is the Income Tax upon the mortgage interest which must be paid by the person who receives the mortgage, and which can be deducted from the next payment of his interest. It is following the general practice of deduction, and so on.

Mr. CHURCHIILL: You mean the tenant's deduction from the rent?

Mr. SNOWDEN: Not from the rent, but from the mortgage interest. The person who has bought his house, but has mortgage on it will have to pay—

Mr. CHURCHILL: But would recover?

Mr. SNOWDEN: And would recover, of course.

Mr. OLIVER: May I ask whether the Chancellor of the Exchequer will issue instructions to the inspectors that claims should not be made from people whom they know quite well are not liable to pay. It is not so much that publicity on this matter is necessary among the rank and file of the people who are purchasing houses as that instructions should be given to the inspectors that they have no right to make these claims. I am not referring to the point made by the right hon. Gentleman the Member for Colne Valley (Mr. Snowden), who was referring to the mortgage interest. That is deducted or allowed for, and very rightly so. I am referring to the claims made by inspectors for what would be the rent if they were not paying the mortgage, and I am quite sure, if the Chancellor of the Exchequer were to notify the inspectors, they would carry out his instructions.

Mr. PETHICK-LAWRENCE: I should like to put one point to the Chancellor in regard to Schedule A and in respect to those people who are under the Income Tax exemption limit. It is perfectly true, of course, that if they are made to pay they can recover, but the question surely is whether they can be made to pay in the first instance, because if they can, and they can only recover after a time, that gives rise to difficulties which have been referred to, even though they have the right of subsequent recovery.

Mr. E. BROWN: I desire to call the Chancellor's attention to one small point. In trying to check the figures in the White Paper as to the £14,500,000 of extra revenue, in order to see how the total amount was made up, I found to my surprise that up to and including the year 1919–20 the yield of each Schedule A, B, C, D, and E was given separately in the abstract, but, for some reason that I have been unable to fathom, for each year since 1921 all of it is lumped together in one sum and only two divisions are given, namely, Super-tax and Income Tax. I call the Chancellor's attention to this, because it is a very great convenience to hon. Members who are trying
to check the figures to have the amounts separately, as they were given before 1919.

Clause 19 (Amendment of s. 20 of 12 and 13 Geo. 5, c. 17).

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Major BIRCHALL: I wish to oppose this Clause for the following reason. No one is a greater master of the art of making people happy by legislation and taxes than the Chancellor of the Exchequer. For instance, he puts a tax on imported goods and provides work for the people of this country, or on alcohol, and he makes people sober, but in this particular Clause he falls from that high level, and the result of it will be that a very serious injury will be caused to a number of charities in this country. I am quite sure that most Members of the Committee fail to realize that this apparently innocent Clause is really a most injurious one. The language of it is typically officialese and practically unintelligible to the ordinary reader, but the effect of it, we are assured, will be to do real injury and damage to many of the most deserving charities of this country.
The thing works out in this way. Under the Finance Act of 1922—whether it was the intention or not does not matter at the moment—charities which are not subject to Income Tax have been enabled to reap very great benefits. This Clause abolishes these benefits. May I explain in a few words exactly what takes place. A man who desires to subscribe to a charity to the extent of £25 a year signs a deed under stamp, a definitely legal covenant or contract, to pay to that charity for not less than six and a half years the sum of £25 a year. He actually pays£20 to the charity, and sends it an officially marked form known as R 185, which shows that he has paid £5 in Income Tax. He thus pays £20 to the charity and £5 in Income Tax. The charity then presents that form at Somerset House, and the £5 is refunded. Although he subscribes £20, the charity benefits to the extent of £25. Under the Act the charities have increased their income by not less than 25 per cent. in
all cases where the subscriber has been willing to sign a deed binding himself for not less than six and a half years. That process is to be stopped by this Clause, and the result upon the charities which have previously benefited will be serious. What are these charities? Many of them are religious charities, with some of which I am connected. They are engaged in the building of churches, in religious work in foreign lands, and in payments to augment inadequate stipends. These charities have benefited very largely under the Section in the Act of 1922. Then there are charities connected with great works of social service which are admittedly for the benefit of the whole community. One of the largest beneficiaries is the League of Nations Union, which has a special income under this Section of not less than £10,000 a year. A large number of subscribers have guaranteed to pay their subscriptions for not less than six and a-half years. The voluntary hospitals have the greatest difficulty in keeping up their income to meet increased charges and to maintain their efficiency. Their difficulty has been so great that the Government recently made them a grant of £500,000 in order to keep them from bankruptcy. These hospitals will be seriously affected by the passage of this Section, and so will the great educational societies. I know quite intimately the condition of the great University of Leeds. They have a very large scheme under the Section of the Act of 1922, whereby subscribers spread their subscriptions over a period of ten years. They have schemes for a building programme for the next ten years and are getting a very considerable income through the operation of the Section. This is to be stopped. The Committee ought not to support the proposal in this Finance Bill without realising what they are doing. Charities have been exempted from Income Tax because they are regarded as objects beneficial to the State. Why, then, prevent this additional income going to them?
12 m.
In his speech on the Financial Resolution, the Financial Secretary to the Treasury defended the present proposal on the ground that most of the agreements were in the nature of bogus agreements.
There was no bad faith at all in regard to this agreement. The agreement was come to quite openly with the full knowledge of all concerned. But the right hon. Gentleman the Financial Secretary to the Treasury, said that such agreements are not intended to be enforced, and that, if the subscriber fails to comply with it and to carry out his obligation, he will not be brought to Court to compel him to carry it out. I say emphatically that that is not so. There is every intention of having these agreements enforced and that they should carry the full consequences. So much is that so that there is actually at present a case before the Court to compel a subscriber to carry out the agreement he has made. Therefore, the main reason given by the Financial Secretary to the Treasury for the inclusion of this Clause, that the agreements are not intended to be enforced, is without foundation. I hope the Chancellor of the Exchequer will even now assent to the withdrawal of this Clause and that he will realise that by doing so he will earn the gratitude of the country generally and give encouragement to charitable people to subscribe to these great and beneficent institutions.

Mr. SNOWDEN: The Chancellor of the Exchequer is always genial, and I hope this morning that he is generous as well. I want to make a very urgent appeal to him to withdraw this Clause. The hon. and gallant Member for North-East Leeds (Major Birchall) who has just spoken has, I think, put all the points against this Clause eloquently, and if the finances of the country were more flourishing than they are at the present time it would be quite impossible for the Chancellor of the Exchequer to resist the urgent demands of all those interested in schools and other educational institutions and also the hospitals. The amount of money which is involved in this proposal is only, I believe, something like £150,000 a year. We are not asking for a new grant; we are not asking for more money, but merely for the withdrawal of this Clause. The point I want to make, and I am speaking it with real earnestness, is that in withdrawing this Clause the Chancellor of the Exchequer is losing nothing at all. I am quite sure, if he adopts this position, he will be able
to use it as an instrument for resisting to some extent the increasing demands which will be made upon him by the educational institutions in this country and by our hospitals. I hope therefore, indeed I believe, the Chancellor of the Exchequer cannot resist this very reasonable request, and I confidently look forward to what he is going to say.

Mr. ERNEST EVANS: I support the appeal that has been made and I hope the Chancellor of the Exchequer will withdraw this Clause. The Clause itself, like the Finance Act of 1922 which it amends, is rather technical, but there is no doubt of its effect. The effects are far-reaching on educational institutions in this country and are very considerable on such institutions as the University of Wales and the National Library of Wales in which I am interested. The Chancellor of the Exchequer last year acted towards the Universities in a generous manner when he restored the grant, and this year, as the result of a deputation of which I was a member, he also met the educational institutions. I hope, in view of that, he will not refuse to accede to the request which we are now making on behalf of the educational institutions in regard to this Clause. I do not want to take up any time, because I know he is impressed by the importance of the matter. The Clause as it stands will involve a considerable hardship on the Universities. In the speech made by the Financial Secretary to the Treasury there seemed to be a misapprehension. He seemed to think that the charities were benefiting private institutions as opposed to private individuals. That is a mistake. That being so, I venture to join in the appeal which has been made that the Chancellor of the Exchequer should accede to our request

Major HILLS: I want to join in the appeal that has been made. It is a very important matter indeed. I do not wish to speak because I want to relieve the taxpayer, but I speak on behalf of the hospitals. Some legal way could be enforced in regard to the matter, and, if the Chancellor of the Exchequer has any doubt, let him insist on a special form of appeal, say, through the Public Trustee. It is the case that charitable gifts have been immensely increased by this system. I take, as a special example, what has
happened in East Leeds. An immense fund has been raised for the University of Leeds and a further sum for the Cancer campaign. I can imagine no more splendid work than the Cancer campaign at Leeds, and large sums have been obtained more easily by this system of gifts. I am sure the Chancellor of the Exchequer does not want to do anything to hinder those great enterprises getting money or charities getting money. If he is satisfied that these are perfectly genuine transactions, that a man who pledges himself to give money would be obliged to give it, and that proceedings would be taken in a court of law if he did not give it, I hope that a large part of the objections of the Chancellor of the Exchequer will be removed, and that he will see his way to agree to the deletion of the Clause.

Mr. CHURCHILL: In logic and in equity, undoubtedly the case for this Clause stands quite unassailed. There are no grounds in logic and equity for saying that any individual citizen, however much he may desire to do a charitable action, should do a portion of that action at the expense of the general taxpayer. Therefore, if we were to judge this question on grounds of logic and equity, there would be no reason for receding in any way from the arguments on which this Clause is based. But I acknowledge that sentiment plays its part, and sentiment ought to play its part, and, mixed with sentiment is undoubtedly the practical considerations which have been urged by the right hon. gentleman the Member for Colne Velley (Mr. Snowden) that, but for these benefactions, there are charitable institutions of many kinds which otherwise would be drawing very near to the moment when they would make a demand upon the State. If the individual, by his benefactions deprives the State of a certain proportion of its revenue, at any rate he distributes a larger proportion, beyond what he would have contributed to the State, towards these worthy objects. In these circumstances, in view of the appeals which have been made in every part of the House, I desire to withdraw the Clause.

Mr. SNOWDEN: I am sure that I shall be expressing the gratitude which every hon. Member of the Committee feels when
I say how delighted we are that the Chancellor of the Exchequer has seen his way to withdraw this Clause.

Mr. SCRYMGEOUR: In view of the long connection which the right hon. Gentleman the Chancellor of the Exchequer had with the City of Dundee, may I be allowed to say that his decision is very gratifying, and in consonance with the information which we had as to an application which he had conceded to the asylums of Scotland. Both are quite satisfactory.

Question, "That the Clause stand part of the Bill," put, and negatived.

Clauses 20 (Amendment as to relief from, tax in respect of losses), 21 (Application of Section 29 of Finance Act, 1926, to, certain cases), and 22 (Amendment as to exemption from Income Tax in respect of profits of trades carried on by charities), ordered to stand part of the Bill.

CLAUSE 23.—(Payment of Income Tax on certain copyright royalties by deduc- tion.)

Captain MACMILLAN: I beg to move, in page 10, line 27, at the end, to add the words:
(5) In this section the expression "royalties or sums paid periodically" shall include only royalties or sums paid periodically in respect of sales of copyright material absorbed in the United Kingdom.
This Clause makes a non-resident owner of copyright material liable for Income Tax upon sums received as royalties in respect of the sales. Those who are engaged in the publishing trade are not quarrelling with the object of the Clause. It is quite clear that the sums which are received as royalties in respect of sales effected in the United Kingdom should be subject to Income Tax if the author or owner is resident abroad, but the argument seems to me to be strained when you say that those who reside abroad and draw profits for the sales of their works abroad should contribute through the Income Tax towards the general taxation of the country. It may not be within the knowledge of the Treasury that the publishing business in this country carry on their trade in many parts of the world; and what we are seeking to provide is that the sums payable to non-residents, or foreign authors,
should not be liable to English Income Tax, merely because of the fact that their works are published by English publishing firms. If an English publishing house is carrying on business in France, or India, or Egypt, and a native of one of these countries, by the mere fact that he is doing business with a firm whose headquarters are in London, makes himself liable to Income Tax in this country, the result would be to drive away the business for English publishing houses, which would mean a loss to the Treasury and the publishing business. At present an English business carrying on a large part of its work in foreign countries, the profits on the business abroad and in England are subject to English Income Tax. We want to ensure that while in respect of the sales in this country it is right that Income Tax should be deducted for royalties paid to non-resident authors, there should not be brought about by this Clause a situation abroad which would reflect injuriously on the business carried on by such firms who have had the enterprise to carry their work into different parts of the world. The words which we propose may or may not be the correct legal phraseology to ensure this point. Indeed, we are not altogether certain, in the advice which we have received, whether such words are necessary at all and whether the Clause as drawn does not cover our point. I am sure it is not the intention of the Treasury to enact a Clause, the result of which would be to deprive English business firms of the opportunity of competing, in this respect, on equal terms with firms native to the countries where they are working. I hope the Government will accept the Amendment or else between now and the Report stage introduce other words which will make it quite clear that we are only seeking to tax non-resident authors in respect of the sums which they draw from sales of their works to the public of the United Kingdom.
It may be necessary to add that certain complications arise from the fact that in the case of many books by foreign authors, English publishers try to retain, where possible, the Dominions market as well as the United Kingdom market. For instance, many American books are sold to English publishers who handle them in the Canadian and Australian
markets as well as in the English market. If the royalties in respect of sales made in Australia were made subject to English Income Tax—

Mr. COUPER: On a point of Order. The hon. and gallant Member is referring to some Income Tax which is unknown in this country. I understand this is British Income Tax, not "English" Income Tax.

Captain MACMILLAN: I am sorry if I have offended the hon. Member. If the mere fact of dealing with a British house made the author in that case liable to British Income Tax, the tax could easily be evaded by not giving the books in question to the British firms for marketing in the Dominions. That would be a loss both to the firms and to the Treasury.

The ATTORNEY-GENERAL (Sir Douglas Hogg): My hon. and gallant Friend has accurately stated the intention of the Government in introducing this Clause. It is to carry out the recommendations of the Royal Commission on Income Tax to ensure that foreign authors who get royalties from the sale of their works in this country shall not escape the effective charge of Income Tax. It is certainly not the intention of the Government that, under the guise of a Clause to tax foreign authors' royalties in this country, we should do anything to discourage the printing and publishing in this country of foreign works which are going to be sold in the Dominions or abroad. We are very far from desiring to do so, but we are advised that it is doubtful whether or not that unhappy result would ensue from the Clause as drawn. There being that doubt, we cannot accept the actual words of the Amendment put forward, because, as my hon. Friend frankly said, they would not do, and, from the legal point of view, they would present difficulties. We are, however, willing to adopt the second alternative he put forward, that is, to introduce on Report stage words which will be apt to secure the object he has explained to the Committee. I hope that on that assurance my hon. Friend will see his way to withdraw the Amendment.

Captain MACMILLAN: I wish to thank the Attorney-General for whate he has said, and, on the assurance he has given, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

CLAUSE 24 (Amendment of Rule 21 of GENERAL RULES) ordered to stand part of the Bill.

CLAUSE 25.—(Relief in respect of losses on transactions profits of which would be chargeable under Case VI, Schedule D).

Sir H. BUCKINGHAM: I beg to move, in page 12, line 5, to leave out the word "similar."
This Clause seeks to give effect to a purpose which was the subject of an Amendment which I put down last year. At that time the Government were good enough to say they would consider that matter, and I must thank them for the concession they have already made by inserting this Clause into the Bill. In my view, however, the concession does not go quite far enough. The whole object of the suggestion I made was that any casual loss in one year might be set off against a casual profit, that is, any casual loss which comes under the category described in Case VI should be set off against any casual profit which can be assessed under Case VI. In the Clause, however, only a casual loss of a "similar nature" can be set off against a casual profit. If a man makes a profit on, say, underwriting in any year he will be taxed on that profit, and if he makes a loss in the same year on something financial of the same character he will be able to set off the loss against the profit. I think any casual loss ought to be set off if it comes under the description given in Case VI, and therefore I am moving to leave out the word "similar."

Mr. GILLETT: Would the Attorney-General kindly inform us what the word "similar" means? There was a case in the Courts recently dealing with a firm or individual in Ireland who bought a stock of linen in the early days of the War and made a very large profit, and became liable to taxation under Case VI. Would this provision in regard to setting
off a loss apply only if that individual were to deal in linen, or would the word "similar" mean anything that came under Case VI?

The ATTORNEY-GENERAL: The Government have given consideration to the point which has been raised by my hon. Friend who moved this Amendment, and they are willing to accept it and to leave out the word "similar" Perhaps hon. Members opposite will not ask me to explain what it means at this stage. The only point to which I would like to call the attention of the Committee is this, that if we leave out the word in line 5 we shall have to leave it out in three other places, lines 10, 16 and 19 and we shall have to put in the words "under Case VI" after the word "assessed," in line 19. I will move these Amendments when the time comes.

Mr. GILLETT: May I ask the Attorney-General if I am right in understanding in the case I mentioned that, as he has accepted the Amendment, any loss under the Schedule might be put against the profit?

The ATTORNEY-GENERAL: Any loss which arose in a transaction which if it had resulted in a profit would have been taxed under Case VI will be set-off, after this Amendment, against profit that is taxable under Case VI.

Amendment agreed to.

Further Amendments made: In page 12, line 10, leave out the word "similar."

In line 16, leave out the word "similar."

In line 19, after the word "assessed," insert the words "under Case VI."

In line 19, leave out the word "similar."—[The Attorney-General.]

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 26.—(Relief in, respect of losses in business set up after 6th April, 1923.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. E. BROWN: This seems to be a very important Clause, and I should like the Attorney-General to tell us if it is an alteration in the present law or a concession on some point put forward in debate.

The ATTORNEY-GENERAL: This, as the hon. Member has anticipated, is designed to give effect to concessions promised in the course of the debate last year. The object of the Clause is to afford relief in the case of businesses which commenced after 6th April, 1923, where a loss was incurred in 1924 or 1925. The change in the basis of assessment from the three years' average to the preceding year prevents these losses from operating, in the average, to reduce the liability for 1927–28 or 1928–29, and they are outside the scope of the new provision for carrying forward of Clause 33 of the 1926 Act, because that applies to losses incurred in 1926.

CLAUSE 27.—(Relief in respect of losses where business is transferred to a company.)

Mr. H. WILLIAMS: I beg to move, in page 14, line 21, after the word "solely," to insert the words "or mainly."
Last year I urged upon the Chancellor that he should give some consideration to cases where real continuity is preserved in a private business which for good reasons is turned into a company, and I was given the promise that something should be done in this Finance Bill, and Clause 27 represents the performance of that promise. I wish to express my grateful thanks for what has been done. I think, however, that there are respects in which the Clause is a little narrow, and accordingly I have put forward my Amendment. It might happen that some small consideration other than shares might be given. It might be of small importance. I might also mention another point. Where the shares are allotted, people should not be debarred from enjoying the same benefits.

The ATTORNEY-GENERAL: This seems to us to be a reasonable Amendment, and I accept it on behalf of my right hon. Friend.

Amendment agreed to.

Mr. H. WILLIAMS: I beg to move, in page 14, line 24, after the word "whom," to insert the words "or to whose nominee or nominees."

The ATTORNEY-GENERAL: On behalf of my right hon. Friend, who is agreeable, I also accept this Amendment.

Amendment agreed to.

Mr. H. WILLIAMS: I beg to move, in page 15, line 22, at the end, to insert the words
(3) Notwithstanding the provisions of section thirty-three of The Finance Act, 1926, where any indiviual is the proprietor of any trade or business and the interest or any part of the interest in that trade or business passes by a voluntary disposition, inter vivos, made by that individual, or under his will, or on his intestacy to the husband or the wife, or any ancestor or lineal descendant, of that individual any loss sustained in such business may be carried forward in like manner as if such individual had remained the beneficial owner thereof.
Two Amendments standing in my name have been accepted, and I hope my good fortune will be the same in the case of the present Amendment, which of course is a matter of great importance. I wish to draw the attention of the Committee to the fact that the Royal Commission on Taxation did suggest that something of the kind ought to be put down. Where a business remains in the family it does seem hard that losses should not be set off if the business is transferred to a company which belongs to the owner of the business. I hope the Government will give some consideration to this point and look into the matter further to see if something cannot be done.

The ATTORNEY-GENERAL: I am sorry my hon. Friend backed his luck once too often. I am afraid we cannot accept this Amendment for this reason: The Clause is designed, as the hon. Member has pointed out, to ensure relief in cases where a business has passed from a private individual to a company and is really the same business carried on in the name of the company. But the same principle of granting relief does not apply when the business is passed from one person to a different person, as for instance from a father to his son as contemplated by my hon. Friend. Father and son are regarded for Income Tax purposes as entirely different persons; if you are going to assess Super-tax on the profits of the business, you do not aggregate the profits of father and son. You have the father taxed on his share and the son on his share. They are separate persons. So we do not think we can treat them as the same persons as regards obtaining relief. Income Tax is essentially a personal tax and not a tax on business as
in the case of Excess Profits Duty. It is a personal burden on the individual, and we do not think it right therefore to ask the Committee to accept a provision that enacts in a case like this that two persons shall be treated as one. If the son succeeds to a business which had originally a capital of £20,000 and the father has losses of £3,000 the son gains £17,000 instead of gaining £20,000.
It does not seem, therefore, fair that for Income Tax purposes he should be allowed to keep it for his own. For these reasons the Government cannot accept the Amendment.

Amendment negatived.

CLAUSE 28.—(Amendment of Section 84 of Income Tax Act, 1918.)

Mr. GATES: I beg to move, in page 15, line 28, to leave out the word "may" and to insert instead thereof the word "shall."

Mr. CHURCHILL: I think it may save the time of the Committee if I say that the Government, are prepared to accept this Amendment. It carries out our intention with regard to these appointments. I shall not be able to accept the next Amendment on the paper—in page 15, line 29, after the word "pleasure" to insert the words "with the benefits of the Superannuation Acts, 1834 to 1909"—because—

The CHAIRMAN: That is not in order.

Mr. CHURCHILL: Then I am relieved from arguing that matter by your ruling. Nor shall I be able to accept the Amendment in the name of the hon. Member for the Moss Side Division (Mr. G. Hurst)—in page 15, line 30, after the word "remuneration'' to insert the words
not being less than the remuneration paid for the year ending the thirtieth day of April, 1927.
I could not accept that because it would suggest that the remuneration should remain unchanged in spite of any reduction of work. I am ready to accept the Amendment of the hon. Member for Abingdon (Major Glyn), which deals with the position of the collector. I am not attempting to argue these
points, but I thought it would be more convenient for the Committee to know the intention of the Government at this point.

Mr. GATES: May I thank the right hon. Gentleman?

Amendment agreed to.

Major GLYN: I beg to move, in page 15, line 36, at end, to insert the words
(2) Where by virtue of section eighty of The Income Tax Act, 1918, the General Commissioners have power to appoint a collector for any area those Commissioners shall appoint a collector for that area to hold office during their will and pleasure, and sub-section (1) of that section shall have effect as if for the words "in the month of April in every year" there were substituted the words "within a month from the occurrence of a vacancy for a collector.
In view of what the right hon. Gentleman has said, I will not delay the Committee. I understand the Government accept the Amendment, and I therefore formally move.

Amendment agreed to.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Mr. DALTON: Now that we have reached this stage, I think it may be convenient to ask the Chancellor of the Exchequer how much further he proposes to go. We have dealt with 20 Clauses and considerable progress has been made. I understand that the evasion group of Clauses are not to be taken. They deal with Super-tax, and Clause 34 also contains some technical points.

Mr. CHURCHILL: I am afraid I must ask the Committee to carry out the plan which we set in mind at the beginning of the day, which was not objected to by any of the leaders of the various parties concerned. It is quite true that we have now completed Clause 28. I propose now to move the postponement of the Clause dealing with the Super-tax and the evasion section in order that they may be brought on in good time on Monday, and to proceed with the other Clauses up to Clause 45, stopping there. I do not think that in these Clauses there is any controversial matter that will be raised. That leaves the evasion problem for Monday and the Road Fund, as large
issues for that day, and we will keep one day further for the Debate on the Betting Duty.

Clause 29 postponed until after Clause 45.

Clause 30 postponed until after postponed Clause 29.

Clause 31 postponed until after postponed Clause 30.

Clause 32 postponed until after postponed Clause 31.

Clause 33 postponed until after postponed Clause 32.

Clause 34 postponed until after postponed Clause 33.

Clauses 35 (Charge of Income Tax at standard rates and at higher rates in respect of income above certain amount), 36 (Provisions with respect to Income Tax chargeable by way of deduction), 37 (Substitution of reliefs by way of reduction of tax for reliefs by way of deductions from assessable income, &c.), 38, (Provisions with respect to making and determination of claims), ordered to stand part of the Bill.

CLAUSE 39.—(Provisions as to date of pay- ment, assessment, &c., of Surtax).

Sir COOPER RAWSON: I beg to move., in page 26, line 13, at the end, to insert the words
Provided that, if an individual liable to surtax under section thirty-five, paragraph (b), hereof died during the year of assessment, no surtax shall be assessed or charged in respect of such year of assessment, and if he die during the year next following the year of assessment a part only of this surtax shall be payable, proportionate to the part of the year next following the year of assessment as shall have elapsed before the date of death.
The object of the Amendment is to prevent injustice to the estates of deceased taxpayers in consequence of this Act in connection with the change over from Super-tax to Surtax, and also to bring Surtax practice into the same line as case law with regard to Supertax. The present practice is governed by Section 6 of the Income Tax of 1918, and, if a Super-taxpayer dies during any year for which Super-tax is chargeable, his estate is liable only for a proportion of the Super-tax up to the actual date
of his death. As an illustration, if under the existing tax a Super-taxpayer is liable for £200 Super-tax payable under this Bill on 1st January, 1930, and he dies on 5th April, 1929, his estate pays nothing, but if he dies on 5th October, 1929, his estate pays one-half, or £100, or pro rata according to when he dies.
Under this Bill, if he dies on the same date, and his estate is liable to the same amount, his estate is liable for the whole amount whether he dies on 5th April or any subsequent date. The only object of the Amendment is to bring the law with regard to Surtax into the same line as the law regarding Super-tax.

The ATTORNEY-GENERAL: I am afraid it is not possible for the Government to accept the Amendment which has been moved by my hon. Friend. The position, the Committee will appreciate, is that by virtue of the charges proposed in the Finance Bill Super-tax disappears and another tax called Surtax takes its place. Surtax is only really an additional Income Tax, the levying of which is deferred for a certain period. Under the Clause nobody will pay Surtax for more or less years than he has a Surtax income. Everyone will pay Surtax on exactly the number of years for which he enjoys an income which renders him liable to Surtax. Under Super-tax, people paid the tax for a year less than they ought, for they paid it not in the year they first entered it, but the year after. Now we are changing the system. The Surtax, which is only a deferred amount of Income Tax, is going to be levied in every case for exactly the number of years for which a person is liable to pay it—for exactly the period during which the person surtaxed enjoys an income which entitles him to the Surtax. We could not accept the Amendment, the effect of which would be that people liable to the Surtax would pay less Surtax.

Sir FRANK MEYER: I am sorry the Government have not seen fit to accept this Amendment. I hope they will carefully consider it before the Report stage, because I do not think the Committee, or the country, has fully realised that under the guise of simplification, and making the Super-tax combine with the Income Tax into one tax, the Government is
getting an extra year, just as the Chancellor of the Exchequer, by shortening the brewers' credit, has got two months in the last two years, and under Schedule "A" in one year he is getting six months ahead. It will not be recovered until the Day of Judgment. Only people who have studied the question have realised that he is going to get an extra year's Super-tax. Whereas it has been one year in arrear, it is now brought forward and people will be mulcted to that extent. The estates of people who die shortly after the end of the financial year will have to pay the full year's tax. That seems to have been brought forward without the attention of the country being closely drawn to it. Between now and the Report stage the Government should consider whether they have been quite fair to the hardly-pressed taxpayer.

Sir COOPER RAWSON: Will the right hon. Gentleman reconsider this matter between now and the Report stage, so that we can put before him new facts? Anybody who dies after this year suffers a great disadvantage. People who die before this Act are more fortunate. I do not see why anybody should have to pay extra Death Duty in consequence of this Act. I hope he will allow me to put before him further facts.

Mr. CHURCHILL: In the general scheme of simplification there are various aspects which must considered together and balanced against each other. It happens in this particular aspect that there is a gain of revenue to the Exchequer, but in another aspect there is a counterbalancing loss. But, on the whole, I contemplate, in consequence of the scheme of simplification, that the burden on taxpayers as a whole should be virtually unchanged. In these circumstances I think it would be a great pity to make a change which would disturb this balance, and, although between now and the Report stage I would be willing to give my attention to any considerations which my hon. Friend may bring before me, I cannot hold out any hopes that I can in satisfy his desire that I should surrender the gain of revenue which results from one part of the scheme while, at the same time, I should still have to give back to the tax-
payers in respect of another part of the scheme a revenue which almost exactly equals that gain.

Mr. GILLETT: Does the right hon. Gentleman agree with the statement of the hon. Member whom I understood to imply that everybody is going to be liable to pay an extra year. That was the point the hon. Member meant. I was under the impression that what happened was that the year's Super-tax was going to be put forward so as to be one year closer than it was originally, and that ultimately the number of years would be no different from what it was before. The hon. Member implies that it would mean paying an extra year, if not in a lifetime at any rate at the time of death. I think we ought to have the position stated quite clearly to-night.

Mr. DENNIS HERBERT: It appears now to be quite clear that it is the intention of the Government to impose a new tax by this Clause. So far as I have been able to discover there is not in the Budget Resolutions any Financial Resolution on which to found this new tax. The particular reason why I raise the question is this—it has been generally supposed by the hon. Member who moved this Amendment, and by myself and many others, that we had discovered what was an obvious mistake. Now we find that it was the intention of the Government to impose this new tax. The Committee is taken completely by surprise, having had no warning through the Financial Resolutions, and it finds that it is the intention of the Government to impose a new tax.
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I should like the Chancellor to say a word or two on that. I do not want, exactly at this stage of the proceedings, to raise the question in such a way as to cause serious delay, but I am not sure that I should not reserve my right until after the Chancellor has replied to refer the matter to You, Mr. Chairman, as to whether this Clause can be considered in this way without a Financial Resolution.

The CHAIRMAN: Do I understand that the hon. Member submits that question as a point or Order?

Mr. HERBERT: I was wishing to do so, but I was going to delay in the hope that the Chancellor might say a word on the subject.

Mr. CHURCHILL: I will, indeed, if only for the purpose of saving my hon. Friend the trouble of putting a question to the Chair, as to which I anticipate there can be only one answer. Perhaps it has escaped the attention of my hon. Friend that this part of the Bill does not come into operation this year, but only next year, and, therefore, an omnibus Resolution will be necessary before this set of provisions can acquire any validity and become effective, and, therefore, there will be no breach of that time-honoured and most invaluable element in our procedure, namely, the preceding of the imposition of taxes by passing a special Resolution. The Resolution will have to be passed next year before this tax can become operative.

Mr. HERBERT: May I suggest very respectfully to the Chancellor of the Exchequer that he should refresh his memory as to the exact wording of these valuable Standing Orders of the House? There are two of them, Nos. 66 and 67, which are very much in the same language. No. 66 says:
This House will receive no petition for any sum relating to public service,
etc. No. 67 says:
This House will not proceed upon any petition, motion, or bill, for granting any money,
etc. Under these circumstances, I suggest that what the Standing Orders require is not a Financial Resolution before something becomes operative, but a Financial Resolution before this House will proceed to receive a petition or proposals, and that the proposals for new taxation should not be entered upon without a Financial Resolution preceding them.

The CHAIRMAN: If this were a new point, it might cause me some difficulty, but it has been laid down by at least one ruling in the past that, if a tax be not operative in the year in which it is proposed, a Clause can be accepted to take effect in the following financial year, if a Resolution to that effect be brought forward in that year which gives vitality to what up to that point was an academic proposition. What the House is asked now to decide is that a particular proposition can come into effect in a future year, but only if in the following year an omnibus Resolution giving authority is brought forward
and carried. I think a former ruling covered that, and I do not feel compelled without notice to say anything as to former Rulings.

Mr. HERBERT: I do not wish to delay the proceedings by a dispute in regard to the Ruling you have just given, but I do ask the Committee to consider the point for one moment.

The CHAIRMAN: I think we had better get rid of the Amendment. If the hon. Member wishes to say anything further, it should be on the Motion "That the Clause stand part of the Bill."

Amendment negatived.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. HERBERT: Before we part with this Clause, I would like to say a word on the aspect of the question of a Clause dealing with a new tax or new charge without a Fnancial Resolution preceding it. I think this is an example of the usefulness of the Standing Orders of the House if interpreted as I suggest they should be—namely, that no Bill dealing with a new tax should be considered or entertained by the House until after it has had warning by and given previous consideration to, a Financial Resolution. This House has always treated with the very greatest respect the Rulings given from the Chair either in Committee or in the House, but no one who has ever occupied the Chair would, I believe, have ventured to do otherwise than to admit that even the greatest of our Speakers or Chairmen has been only human and capable of giving a wrong Ruling.

The CHAIRMAN: The hon. Member may argue that a Clause of this sort should not be brought forward without a Resolution, but he cannot argue against what is now the practice of the House and authorised by previous Rulings. He may argue that this Clause is not one of the nature that should be brought forward in one Session and given validity by Resolution in the next, but I do not think that this is an occasion on which he can argue the whole constitutional question involved. He may argue as to
this particular Clause but not on the general question, and he cannot controvert former Rulings.

Mr. HERBERT: I bow to that, and I will only remind the Committee that this does appear to be a case where it is unfortunate that the Committee did not have previous warning by a Financial Resolution, with the result that the Committee has been surprised in discovering that, instead of there being a mistake in the drafting of the Clause, the Government have intended to propose for a future year a new tax of which Parliament has had no previous warning.

Mr. CHURCHILL: I really must take notice of the complaint So far from the Committee not having the usual warning of any new tax being proposed, they are having more than a year's warning. They are having all the warning given by what has taken place now. They will have the whole year to profit by that. They will have all the warning of the Financial Resolution next year, and all the other warnings which my hon. Friend will, no doubt, bring forward.

Lieut.-Colonel Sir FREDERICK HALL: With regard to the question of Super-tax being collected a year after it is earned, are we to be in the position eventually, in order to make up the leeway, of having two years' Super-tax collected in one year?

Mr. CHURCHILL: Only if you are dead.

CLAUSE 40.—(Power to require returns of income from all sources.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. E. BROWN: Are there any new powers being taken under this Clause? I should like to have a word, if new powers are being taken under it.

Mr. CHURCHILL: There are no new powers.

Mr. GILLETT: What do the words "shall be extended'' mean? I have heard it suggested that in future the details given for preparation of Income
Tax, instead of, as at present, being that income from investments comes to so much, will, under the powers being obtained here, have to include particulars in regard to investments. I understand that this is to give greater powers to the Income Tax Commissioners.

Mr. CHURCHILL: It makes no difference whatever. The only object of this Clause is, not to expand the powers, but to enable the system of one man one return to be adopted, and to provide the necessary machinery to give effect to that important simplification. We are not in any way altering the existing powers to obtain the return of income from all sources which are possessed by the Income Tax authorities, but are only regrouping and redisposing of them in such a way as to facilitate the proceedings.

Clauses 41 (Special provisions as to returns in connection with sur-tax, etc.), 42 (Basis of assessment for Schedule E, etc.), 43 (Minor amendments), and 44 (Construction and commencement of Part III and repeals) ordered to stand part of the Bill.

CLAUSE 45 (Amount of New Sinking Fund (1923) for 1926–27).

The CHAIRMAN: The Amendments in the name of the hon. Member for Leicester West (Mr. Pethick-Lawrence)—in page 34, line 32, to leave out the words, "as respects the current financial year"; and in line 34, to leave out the words, "as respects that year"—would increase the charge and are therefore out of order. With regard to the Amendment standing in the name of the hon. Member for Reading (Mr. H.
Williams)—in page 34, line 35, at the end, to insert the words,
The National Debt Commissioners shall hypothecate for the purpose of paying interest on national savings certificates which may be encashed after the thirty-first day of March, nineteen hundred and twenty-eight, so much of the Sinking Fund as shall be equal to the excess of the interest accruing in respect of national savings certificates during the year ending on the thirty-first day of March, nineteen hundred and twenty-eight, over the amount which shall have actually been paid in interest on the encashment of national savings certificates during that year.
I confess that I am not at all clear as to whether that does not increase the charge also. If the hon. Member wishes to move it, perhaps he will state what is the effect of it.

Mr. SMITHERS: Was it not part of the understanding that we should only go as far as the end of Clause 44?

HON. MEMBERS: Clause 45.

Motion made, and Question, "That the Chairman do report Progress and ask leave to sit again," put, and agreed to.—[Mr. Churchill.]

Committee reported Progress; to sit again upon Monday next (4th July).

The remaining Orders were read, and postponed.

It being after half-past Eleven of the Clock upon Thursday evening, Mr. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the, Standing Orders.

Adjourned at a Quarter after One o'Clock.